Dive Brief:
- Modern Treasury, a San Francisco-based payments infrastructure firm, and Rain, a stablecoin infrastructure platform based in New York City, each applied for national trust charters Monday.
- If approved, the national trust charters, issued by the Office of the Comptroller of the Currency, would allow Modern Treasury and Rain to offer asset custody and other related services. They would not accept deposits or make loans.
- Brandon Soto is Rain National Trust Bank’s proposed CEO. He was most recently chief financial officer at Coastal Financial Corp. but previously served as CFO at Square Financial Services and worked at Green Dot Bank, in part as CFO and in part as administrative chief. Modern Treasury has not yet announced its proposed bank CEO.
Dive Insight:
If approved, Modern Treasury National Trust Bank would give customers a “unified custody solution” of both fiat and digital assets that combines with the firm’s payments and settlement capabilities.
Although founder and CEO Matt Marcus said in a LinkedIn post Monday that stablecoins “are becoming foundational to global money movement,” the proposed bank would not issue its own.
Rain National Trust Bank, however, does plan to issue stablecoins in accordance with the Genius Act; and to hold and administer reserves for other Genius-permitted stablecoin issuers, as well as custodying both fiat and digital assets, the company said in its release.
Farooq Malik, CEO and co-founder of Rain, said in a prepared statement Monday that the firms using Rain to build out their stablecoin infrastructure “want the assets behind their programs held by a fiduciary that answers to a federal regulator." Starting the trust bank is Rain’s answer to customers, he said.
Monday’s trust charter applications are the first to be submitted to the OCC after the agency was sued by trade group Independent Community Bankers of America, which takes particular issue with cryptocurrency firms obtaining such charters.
The OCC has approved or conditionally approved 21 national trust bank charters since President Donald Trump started his second term, according to the lawsuit, which alleged that the national trust bank designation permits firms to preempt state law requirements and avoid federal requirements for depository institutions.
The agency’s current posture “perversely allow[s] entities engaged in highly risky cryptocurrency and digital assets activities to enter the banking system under lightly regulated national charters rather than the more rigorously regulated traditional bank charter,” thus putting community banks at a “severe competitive disadvantage,” said the lawsuit, filed Friday.
Fintechs, crypto firms and payments companies have noticed Gould’s amenability to de novo chartering and have followed suit by submitting dozens of applications, many for trust banks, to the OCC.
Rain’s Soto, who helped lead Square Financial’s quest and receipt of an industrial loan charter in 2020 – well before the rush for charters that has marked 2025 and 2026 – said in a prepared statement Monday that a trust bank’s “first job is simple. Know what you hold, know who you hold it for, and keep it safe.
“I have sat across from bank examiners for twenty years, and the best answer you can give is, ‘Here’s the reconciliation.’ That is the discipline we are building into the proposed national trust bank from day one,” he said. “Clear ownership, daily reconciliation, strong controls, and the right level of capital.”
