Regulatory Attention on Banking versus Cryptocurrency Establishments Under the Trump Administration

In the rapidly evolving world of cryptocurrency, traditional banking regulations are being challenged as firms seek new ways to generate revenue. One such development is the growing interest in national trust bank charters, a move that has sparked debate among regulators and trade groups.

The Genius Act, a piece of legislation that forbids issuers from charging interest to customers, has become a point of contention. Cryptocurrency startups, including Coinbase and Circle, are seeking ways to make stablecoins more financially advantageous, despite the Act's restrictions. Some in the banking industry express concerns that Coinbase's rewards program may go against the Act's no-interest requirement.

The Office of the Comptroller of the Currency (OCC) under Trump-led regulators is considering a role in shaping the relationship between cryptocurrency firms and conventional financial institutions. The OCC's decision to allow crypto firms to apply for national trust bank charters has been met with criticism for not seeking public feedback first. However, the potential benefits are significant. If granted, these charters could make cryptocurrency enterprises more credible and eliminate the need for multiple state-level licenses.

Several crypto firms, including Ripple Labs and Circle Internet Group, have already applied for these charters. Coinbase, another prominent player in the cryptocurrency space, claims that their rewards scheme follows all rules and regulations, with the issue lying in the vague and interpretable legal language of the Genius Act.

The use of national trust bank charters by cryptocurrency enterprises could also pave the way for a broader range of services. The OCC aimed to broaden the range of services offered by trust banks under Trump 1.0, potentially including loan issuance and payment settlement.

Meanwhile, digital assets are gaining popularity as a payment method and a tool for traders to enter and leave the cryptocurrency market. In March, SmartBiz became the first financial-technology company to receive regulatory approval to operate as a bank since the beginning of President Trump's administration, potentially signalling a trend for other fintechs to enter the financial-services sector.

As the landscape of blockchain-based governance, privacy-preserving technologies, and stablecoins continues to evolve, the GENIUS and CLARITY Acts are being discussed in this context. The future of cryptocurrency and its relationship with traditional banking remains a topic of ongoing debate and regulation.

In other news, Takatoshi Shibayama, host of the podcast "Blockcast," continues to feature guests from the blockchain and cryptocurrency industry, including Eric van Miltenburg (Ripple), Hassan Ahmed (Coinbase), and Charles Hoskinson (Cardano). Blockcast is also a media partner of Coinfest Asia 2025, with a discount code available for tickets.

As always, stay informed and stay ahead in the world of cryptocurrency.