OCC Faces Potential Lawsuit from BPI Over Crypto Trust Bank Charters

The OCC faces a potential lawsuit from BPI over crypto trust bank charters. The Bank Policy Institute is considering legal action against the Office of the Comptroller of the Currency over national trust bank charters for crypto firms.

BPI represents major U.S. lenders, including JPMorgan Chase and Goldman Sachs, and argues the charter route applies a narrower framework than the one used for full-service banks.

BPI Reviews Legal Options Against the OCC

BPI has not filed a lawsuit, and it has not made a final decision on whether to proceed. The dispute has so far played out through comment letters, regulatory objections, and public statements.

If BPI sues, the dispute would move from policy to litigation. The case would test how the agency is using its chartering authority. The core question is whether the OCC is applying the national trust bank framework in a way that banks say goes beyond its traditional limits.

OCC’s Trust Charter Moves Intensify the Dispute

The conflict intensified in December when the OCC conditionally approved national trust bank charters for several digital asset firms, including Ripple, BitGo, and Paxos. Those approvals gave crypto companies a federal path to offer custody and trust-related services without becoming deposit-taking banks.

The policy debate widened again after the OCC finalised a rule stating that national banks limited to the operations of a trust company and related activities may also engage in non-fiduciary activities alongside fiduciary ones. The agency said the rule does not expand or contract its chartering authority.

Banks Warn the Trust Charter Route Creates a Regulatory Shortcut

Banking groups have argued for months that the OCC is stretching a trust-company charter beyond its traditional boundaries. Banks say applicants should operate as trust companies. They argue that some firms are using the charter to reach bank-like activities.

BPI has pointed to areas such as stablecoin reserve management and payments as examples of services that should face a broader supervisory and consumer-protection framework. Banks argue the trust-bank route could let some firms provide bank-like services under a different standard than the one applied to full-service banks.

That argument sits at the centre of the dispute. The issue is not only crypto. It is whether a federal charter can be used for a narrower institution while still reaching activities that traditional banks say belong inside a more comprehensive framework.

ABA and State Regulators Press Separate Challenges

The American Bankers Association (ABA) has also pressed the OCC to move more cautiously while digital asset rules continue to develop. It has raised concerns about naming standards, consumer confusion, and how limited-purpose entities present themselves to the public.

State regulators have taken a different line of attack. The Conference of State Bank Supervisors has argued that the OCC is assembling charter structures in a way that allows nonbank firms to operate nationwide beyond what the National Bank Act permits.

Court Fight Would Stress-Test the Crypto Trust Charter Route

A lawsuit from BPI would test more than one approval or one crypto applicant. It would put the OCC’s broader reading of the national trust bank charter under direct legal pressure at a time when more digital asset firms are pursuing a federal route into custody, payments, and related financial services.

That makes the dispute important for both banks and crypto firms. For banks, it is a challenge to understand how federal supervision is being applied. For crypto firms, it is a question of whether the charter path now taking shape can withstand a direct legal challenge.

The OCC’s recent charter decisions have made the national trust bank charter a central route for digital asset firms seeking federal supervision. A court challenge would test the charter’s limits.