Community banks sue OCC over crypto trust bank charters

The Independent Community Bankers of America (ICBA) has filed a lawsuit against the Office of the Comptroller of the Currency (OCC) in the U.S. District Court for the District of Columbia. The trade group argues that the regulator has exceeded its congressional authority by allowing cryptocurrency firms to obtain national trust bank charters.

The ICBA contends that these charters allow digital asset companies, including firms like Coinbase, Ripple, and Circle, to gain the credibility of a federal bank charter without being subject to the same regulatory requirements as traditional community banks. Specifically, the lawsuit claims these firms bypass capital and liquidity standards, consolidated supervision, Community Reinvestment Act obligations, and FDIC insurance.

The legal challenge targets the OCC’s March 2026 chartering rule and its 2021 Interpretive Letter 1176. The ICBA also seeks to vacate the conditional approval of Protego, a digital-asset custodian. While the OCC maintains it is merely clarifying its existing authority to allow trust companies to engage in non-fiduciary activities, the ICBA describes the regulatory pathway as a ‘side door’ into the banking system for crypto businesses.