Rain files for US national trust bank charter as OCC faces suit over crypto charters

Stablecoin payments infrastructure provider Rain has applied to the Office of the Comptroller of the Currency (OCC) to set up Rain National Trust Bank in New York. If approved, the charter would give Rain a federally regulated route to custody digital assets and US dollars, manage reserves for permitted stablecoin issuers, and issue and redeem dollar-backed stablecoins under the GENIUS Act.

1. Rain said Monday it filed the application with the OCC to establish a national trust bank headquartered in New York. The proposed bank would be called Rain National Trust Bank, putting the company into the same charter queue that has attracted a growing number of crypto and payments firms over the last year.
2. The bank, if approved, would be able to provide fiduciary custody of digital assets and US dollars for institutional clients. It would also provide reserve management for permitted stablecoin issuers and handle issuance and redemption of dollar-backed stablecoins in accordance with the GENIUS Act, which is the part PSPs and stablecoin firms will care about because it defines what the institution can actually do with client assets.
3. Former Square Financial Services chief financial officer Brandon Soto is set to serve as president and CEO of the proposed national trust bank, subject to OCC review. Rain CEO and co-founder Farooq Malik said the institutions building on Rain want the assets behind their programs held by a fiduciary that answers to a federal regulator.
4. Rain is not alone. Payments infrastructure company Modern Treasury also said Monday it had submitted an application seeking approval to offer digital asset custody and related fiat services. The pattern is obvious enough: infrastructure companies are trying to move closer to a bank-style regulatory perimeter rather than staying in the usual PSP gray zone.
5. The push is now running into community-bank resistance. On Friday, the Independent Community Bankers of America sued the OCC in the US District Court for the District of Columbia, naming the OCC and Comptroller Jonathan Gould and arguing the regulator exceeded its authority by allowing non-depository trust banks to conduct extensive non-fiduciary activities.

According to the ICBA’s complaint, the OCC has approved or conditionally approved at least 21 trust banks, with at least 13 of them being crypto companies. The group says the framework gives crypto trust banks a competitive advantage and could lead consumers to mistake the “national bank” label for federal deposit insurance; on Monday, the Crypto Council for Innovation called the lawsuit an attempt to stifle innovation.