Community Bankers Sue OCC, Say Crypto Trust Charters Create a Regulatory 'Side Door'

Add preferred source The Independent Community Bankers of America filed a federal lawsuit against the Office of the Comptroller of the Currency, challenging the regulator's authority to grant national trust bank charters to cryptocurrency firms. The suit, filed in the U.S. District Court for the District of Columbia, asks the court to invalidate the OCC's March 2026 chartering rule, its 2021 Interpretive Letter No. 1176, and the conditional approval granted to digital asset firm Protego Holdings Corp. ICBA argues that Congress authorized trust charters for fiduciary functions, not for substantial non-fiduciary businesses such as crypto trading, lending, and asset administration. The group says crypto firms gain federal charter credibility without the obligations that apply to insured depository institutions, including Community Reinvestment Act requirements, consolidated supervision, capital and liquidity standards, and FDIC insurance. The OCC maintains its rule clarified longstanding authority rather than expanding its powers.