Warren Raises Concerns Over Crypto Firms' Push Into US Banking

Sen. Elizabeth Warren, a Massachusetts Democrat, has raised concerns about crypto firms expanding their access to the US banking system.

Bloomberg reported on May 19 that Warren sent a letter to the Office of the Comptroller of the Currency, saying some crypto companies are pursuing bank-like business lines while facing lighter regulation than traditional banks.

In the US, crypto firms are seeking national trust company charters to gain access to the Federal Reserve's payment network and other services. The framework permits limited financial activity and is subject to less intensive supervision than a traditional bank charter.

Warren argued that some companies are trying to move beyond custody and expand into businesses that resemble banking, including lending, payments and trading platform operations.

Bloomberg recently reported that Ripple, Paxos and a Coinbase affiliate have sought or received the charters. An application from an affiliate of World Liberty Financial, which is tied to President Donald Trump's family, is also under review.

She also raised concerns that the OCC's easing of trust company rules this year could let crypto firms broaden their financial activities too far.

"If they are allowed to engage in bank-like businesses without the same regulations and safeguards, it could create problems for consumer protection and the stability of the financial system," Warren said.