Block applies for national trust bank charter to custody bitcoin and stablecoins

Block, the payments company founded by Jack Dorsey, wants federal regulators to let it custody bitcoin and stablecoins through a chartered trust bank. On Tuesday, the company said it applied to the Office of the Comptroller of the Currency (OCC) to establish Builders Bank & Trust, N.A., an uninsured, non-deposit-taking national trust bank.

If approved, Builders Bank is ready to offer custodial and fiduciary services for bitcoin and stablecoins, and some of Block’s existing digital asset activities will fall under a single federal regulatory framework.

The combination of Block’s experience with digital assets and Square Financial Services positions Builders Bank well “to support Block’s broader vision of economic empowerment,” said Lee Woolley, proposed president and CEO of Builders Bank.

Why custody is the prize, not deposits

One of the main attractions of an OCC national trust bank charter is custody. Davis Wright Tremaine describes custody as “the foundation of any digital-asset business”. A national trust bank charter can bring cryptocurrency companies under the federal umbrella and provide them with a certain level of comfort in dealing with various state regulations, as well as give institutional clients the comfort of using recognized oversight.

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