The Independent Community Bankers of America has filed a federal lawsuit against the Office of the Comptroller of the Currency, arguing that the regulator went beyond its authority under the National Bank Act by granting national trust bank charters to crypto companies.
The trade group says the OCC effectively opened a path for digital asset firms to obtain federal banking privileges without carrying out the traditional fiduciary functions associated with national trust banks. The case asks the court to set aside both the OCC’s final rule and Interpretive Letter 1176.
Core dispute over OCC authority
At the center of the complaint is the ICBA’s claim that Congress did not authorize the OCC to extend national trust charters to companies engaged in non-fiduciary digital asset activities. According to the suit, the regulator expanded the use of these charters beyond what the National Bank Act permits.
The lawsuit was filed after criticism that the OCC had been granting banking charters to crypto firms through what opponents describe as a workaround. The ICBA argues that federal chartering authority should not be repurposed for non-bank technology companies that do not operate like traditional banks or trust institutions.
Why the charters are being challenged
The banking group contends that the OCC’s approach creates a regulatory loophole. In its view, national trust charters allow crypto firms to secure federal recognition and certain banking-related advantages while avoiding the standards normally tied to full banking status.
The suit specifically argues that firms receiving these charters may not be subject to the same capital, liquidity, supervisory, Community Reinvestment Act, or FDIC-related expectations that apply elsewhere in the banking system. The ICBA says federally chartered banks should meet established banking standards and provide the consumer protections expected of such institutions.
Rule and companies in focus
The complaint seeks to vacate the OCC’s final trust rule as well as Interpretive Letter 1176, which the ICBA says broadened the scope of national trust charters. The legal challenge is aimed at the framework that permitted these approvals, rather than at a single company.
At least 13 charters are tied to digital asset firms, according to the article. Companies linked to those charters include Circle, Coinbase, and Ripple.
What a court ruling could change
If the court sides with the ICBA and invalidates the OCC’s trust charter framework, crypto infrastructure providers and custody platforms operating under conditional charters could face structural changes. They may need to reorganize under state-level charters or seek full-service federal charters that come with standard banking requirements.
Industry figures in the crypto sector have pushed back on the lawsuit’s premise, arguing that the challenge would limit competition and could make it harder for community banks and digital asset firms to work together. For now, the next confirmed step is the court’s review of whether the OCC’s trust charter rule and related interpretive guidance can remain in place under existing federal banking law.
Source: news.bitcoin.com