Crypto industry and banking representatives are beginning to expand into each other's niches
A number of cryptocurrency companies are planning to apply for banking licenses in the United States, The Wall Street Journal (WSJ) reported, citing sources familiar with the matter. At the same time, several large banks are studying the possibility of entering the crypto industry.
Some U.S. cryptocurrencies are interested in becoming a national trust or industrial bank, which would allow them to operate like traditional lenders, such as accepting deposits and making loans. Others are seeking highly specialized licenses that would allow them to issue stablecoins.
Among those cryptocurrency companies looking to expand are exchange Coinbase, steablecoin issuers Circle and Paxos, and custodian BitGo. The latter is close to applying for a banking license, people familiar with the situation told the publication.
BitGo is one of the largest custodian providers in the crypto industry, founded in 2013. The company offers cryptocurrency storage solutions, multi-signature wallets, and provides institutional infrastructure for trading and settlement. It serves exchanges, investment funds and corporate clients.
Earlier it became known that BitGo will provide custodial services to the Trump family's crypto project World Liberty Financial (WLFI). The service will hold reserves securing the USD1 stablecoin issued by WLFI.
Following US President Donald Trump's return to the White House, regulators rescinded previously imposed rules requiring banks to be authorized to participate in cryptocurrency activities. Additional guidelines are expected to be issued this year on how banks can work with cryptocurrency, a source familiar with the situation told the publication.
However, any cryptocurrency company that receives a banking license will be subject to stricter scrutiny from regulators, the report noted. Currently, the only cryptocurrency company in the US with a federal bank license is Anchorage Digital. The company said it has spent tens of millions of dollars on regulatory compliance.
Anchorage, along with Coinbase, this year became the custodian for BlackRock's bitcoin exchange-traded fund (ETF), which has an asset value of more than $48 billion, according to SoSoValue data as of April 17. Anchorage has also teamed up with Cantor Fitzgerald and cryptocastodian Copper for a $2 billion bitcoin lending program. Cantor was previously headed by Commerce Secretary Howard Lutnick, and that company holds the Treasury bonds that make up Tether's USDT stablecoin reserves.
Meanwhile, some banks are looking to connect with the cryptocurrency industry. In February, Bank of America CEO Brian Moynihan said his bank would issue its own stablecoin if the legal framework was in place to do so.
In April, U.S. Bancorp said it would relaunch its cryptoasset storage service. And a consortium of banks that includes Deutsche Bank and Standard Chartered has begun exploring the possibility of expanding cryptocurrency operations in the U.S., according to reporters.
Cryptocurrency companies' entry into the traditional finance market is not limited to banking. Since mid-April, the Kraken crypto exchange has opened trading for its clients not only in digital currencies, but also in classic instruments - shares of companies and exchange-traded funds (ETFs).
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