Many large cryptocurrency companies such as Circle, BitGo, Coinbase, and Paxos are considering applying for bank licenses. The Wall Street Journal on April 21 reported that Circle and BitGo are weighing different types of bank licenses. Paxos received preliminary approval for a bank license from the United States Office of the Comptroller of the Currency in 2021. This change occurs as the United States attempts to regulate the stablecoin industry.
Jerome Powell, Chairman of the Federal Reserve, noted that as cryptocurrencies become more prevalent, it is necessary to establish a legal framework for stablecoins. He emphasized that after many failures and frauds, the cryptocurrency industry has developed highly attractive applications.
In April, the United States House Committee on Financial Services passed the STABLE draft law, emphasizing the transparency and accountability of stablecoins. Simultaneously, the GENIUS bill was also being processed, offering a more flexible proposal that combines state and federal regulations. The STABLE Act requires stablecoin reserve funds to be separated from business funds, while the GENIUS Act provides a legal framework for stablecoin payments and enhances anti-money laundering safety.
Cryptocurrency companies want bank licenses to operate like traditional banks and be subject to stricter supervisory regulations. Anchorage Digital already has a federal bank license and is spending significant amounts to ensure compliance. However, they are currently under investigation by the US Department of Homeland Security. As early as March, there were indications that fintech and cryptocurrency companies were seeking bank licenses to expand during the Trump administration.
These changes reflect the transformation trend of not only companies but also national policies. Stricter regulations may help the cryptocurrency industry develop more sustainably while strengthening the global position of the US dollar.
