Anchorage has won the race to become the first federally chartered digital asset bank by obtaining a national bank charter from the Office of the Comptroller of the Currency (OCC).

The institutional crypto custodian is now on even firmer footing with its designation as a “Qualified Custodian” under the Securities and Exchange Commission’s (SEC) requirements. Investment advisers have to keep client funds and securities with those that meet the qualified custodian standard, usually banks or registered broker-dealers.

In a statement, the OCC highlighted the “conditional approval” of Anchorage’s banking bid.

“The OCC granted a national trust bank charter to Anchorage after thorough review of the company and its current operations.  As an enforceable condition of approval, the company entered into an operating agreement which sets forth, among other things, capital and liquidity requirements and the OCC’s risk management expectations,” the regulator said.

With a banking charter, the Anchorage Digital Bank National Association can provide sub-custody services — like holding assets for a main custodian — for any financial institution, according to Anchorage. 

“Before now, there have existed fintech companies with the technical sophistication to securely handle digital assets under a piecemeal, state-by-state regulatory structure, and there have existed federally chartered banks with a robust regulatory framework that lack the true technological savvy it takes to operate in the blockchain space at its breakneck pace of innovation,” said Nathan McCauley and Diogo Mónica in a joint statement.

Anchorage Digital Bank, they say, can now provide the tech and regulatory clarity that “serious institutional participation” requires.

Other players are also looking to obtain banking charters in the near future. BitPay and Paxos both applied for federal charters from the OCC in December. Avanti remains a state-regulated bank under Wyoming’s charter. 

Anchorage’s approval comes days before Acting Comptroller Brian Brooks is slated to end his tenure with the bank regulator, according to a report from Politico.

© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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Author: Aislinn Keely

Categories: Legal

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