Payward Applies for OCC National Trust Company Charter

Payward, the parent company of Kraken crypto exchange, has applied for a national trust company charter with the Office of the Comptroller of the Currency, according to a statement. The application seeks to establish the Payward National Trust Company (PNTC) to serve institutional clients and individual customers seeking regulated, bank-level custody and trust services for digital assets.

Application Details

"PNTC expects to serve institutional clients and individual customers seeking regulated, bank-level custody and trust services for digital assets, leveraging Payward's existing infrastructure, risk management, compliance programs, and regulated affiliates to deliver services in a secure and compliant manner," Payward said in a statement.

Payward and Kraken co-CEO Arjun Sethi stated: "Our long-held belief has always been that the right path forward for digital assets runs through robust, transparent regulation. A national trust company provides the certainty institutions require and establishes the infrastructure to build the next generation of custody."

Regulatory Context

Payward's application follows Coinbase, the largest U.S.-based crypto exchange, receiving conditional approval for its own national trust company charter approximately one month prior. Ripple has also received conditional approval for a national trust company charter.

Banking Industry Response

A trade group whose board includes major banks such as JPMorgan Chase, Goldman Sachs, and Bank of America at one point considered filing a lawsuit against the OCC over the regulator's move to grant national trust bank charters to crypto and fintech firms. The banking advocacy group considered arguing that the OCC is failing to "heed repeated warnings" about its "reinterpretation of federal licensing rules."