Crypto companies and financial giants are considering expanding their operations in the U.S. market after the Trump administration worked to regulate the digital asset industry and mainstream it into finance.
Crypto companies and banks expand U.S. operations
On Monday, the Wall Street Journal reported that the cryptocurrency industry “will push deeper into the banking system” as multiple companies plan to apply for banking charters or licenses, including Circle and Bitgo.
News media claim Coinbase and Paxos are looking at similar moves. Meanwhile, some companies that did not want to be named were interested in the National Trust or Industrial Bank Charter, which could operate like traditional lenders, earn loans and deposits.
Other cryptocurrency companies are reportedly seeking specific permissions to issue stable companies as relevant legislation gains momentum in Congress. It is worth noting that companies applying for and obtaining bank charters will be subject to stricter regulatory oversight.
On the other hand, the report also confirmed that traditional financial giants, including Deutsche Bank and the Chartered Chartered, are working to “catch up and connect” with the cryptocurrency industry by reexamining its approach to the industry.
According to sources cited by WSJ, a group of banks have begun exploring new industry-friendly governments’ transition from their “regulatory enforcement” strategies to ways to expand their cryptocurrency operations.
Although details of the so-called plan have not been disclosed, the report notes that other banks remain cautious. It cites Chris Gorman, CEO of KeyCorp, who sees potential opportunities in the cryptocurrency space but wants to assess how it can develop through “regulatory challenges” such as anti-money laundering (AML) safeguards.
Traditional institutions are waiting for US legislation
Other banking giants recently expressed their hope to expand into the cryptocurrency industry. In January, Bank of America CEO Brian Moynihan asserted that the U.S. banking industry is ready to accept cryptocurrencies.
According to the CEO, banks will “hardly” encrypt and establish a clear regulatory framework once regulators allow it. “If the rules come in and allow you to actually do business with it, you’ll find that the banking system will work hard on transactions,” he said.
Moynihan then confirmed that if a legal framework was established, Bank of America would issue a stable person. Since taking office on January 20, the Trump administration has significantly changed the regulatory approach of the previous administration.
The Securities and Exchange Commission (SEC) has revoked or suspended most major law enforcement cases. In addition, U.S. lawmakers have proposed several policies to address various crypto-related topics, including the Strategic Bitcoin Protected Area (SBR) and Stablecoin regulations.
In February, U.S. Senator Bill Hagerty introduced guidance and establishment of Genius Act to develop a framework that allows tokens such as USDT and USDC to comply with Fed rules.
The legislation aims to create a “safe, growth-driven regulatory framework that will unleash innovation and promote the president’s mission to make the United States the capital of the crypto world.”
Bitcoin (BTC) trades at $88,201 in the one-week chart. Source: BTCUSDT on TradingView
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