Crypto Firms Win Bank Charters, Skip Bank Rules
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- Office of the Comptroller of the Currency granted full approval to one crypto firm and conditional approval to at least four others to establish national trust banks over the past year, letting them avoid most state banking requirements.
- Kraken's trust bank gained direct access to the Federal Reserve's Fedwire system on March 4 to settle U.S. dollar transactions, a privilege traditionally limited to regulated banks.
- Crypto companies spent roughly $119 million influencing federal elections in 2024 — almost half of all corporate funds contributed in that cycle, according to an August 2025 Public Citizen report.
- Kraken co-founder Jesse Powell personally donated about $1 million to political efforts connected to President Trump, part of a broader pattern of crypto executive giving.
- Congress established a new stablecoin regulatory framework after heavy crypto lobbying, allowing issuers to pay deposit-like "rewards" to customers without holding bank-level capital buffers or offering deposit insurance.
- Robert Pozen, a former Fidelity Investments president, argues regulators should apply the same capital, liquidity, and customer protection rules to crypto firms performing bank functions or risk repeating 2008-style shadow banking turmoil.
Why it matters: The article's central warning: crypto firms now custody assets, move money through Fed payment rails, and pay deposit-like rewards — all without the capital buffers or insurance that backstop traditional banks. The roughly $119 million in 2024 crypto industry political spending, per Public Citizen, supplies one stated explanation for why regulators have been granting these carve-outs despite the stated risk of a 2008-style spillover.
