Crypto Company Paxos Files To Become A US Bank
Paxos, according to a document filed Dec. 8, is seeking to create the Paxos National Trust, Coindesk writes, which would operate out of New York where the company is located.
Paxos is already in possession of a trust charter in New York and numerous licenses, which lets it operate cash custody, gold custody, cryptocurrency services, digital asset services, securities clearing, commodities trading and numerous other things, according to the report.
In addition, Paxos’s crypto brokerage was tapped earlier this year to help PayPal’s crypto service. General Counsel Dan Burstein, in a blog post, said becoming licensed nationally would let the company do business across state lines more easily.
“This flexibility allows a young company like Paxos to focus resources on building great products,” he said, according to the Coindesk report. “A national Trust Bank charter provides us with flexibility to operate across the U.S. while continuing to adhere to the highest regulatory standards.”
In filing to go national, Paxos joins BitPay and custody provider Anchorage in seeking the federal charters to operate as banks in the U.S. Like with BitPay, Paxos’s application will need to go through the 30-day comment period as the next step in the process. There’s no guarantee Paxos will get the license it wants.
The news comes after acting Office of the Comptroller of the Currency (OCC) Comptroller Brian Brooks said earlier this year that he’d like to see more options for FinTechs, including cryptocurrency firms, to seek national licenses for banking. His focus on crypto has drawn ire from some lawmakers, who see the idea as too generous for deregulation opportunities.
Currently, cryptocurrency firms have to go through the more time-consuming route of acquiring money transmitter licenses in every state where they want to do business. Crypto firms can avoid that by becoming nationally licensed banks.