This article originally appeared in the CPI TechREG Chronicle and is republished with permission from CPI.
Fintechs and the financial services industry are in the midst of dynamic changes to federal regulation, digital-asset market structure, and state experimentation with digital as-set law. Recent Office of the Comptroller of the Currency (“OCC”) interpretive guidance, the enactment of the Genius Act, and state-led stablecoin initiatives have converged to reshape the incentives and ways for fintechs, banks, and stablecoin issuers to enter the emerging market. For lawyers and professionals in finance and digital assets, the core strategic question is no longer whether digital assets will become an integral part of the US financial services industry but rather when and how quickly they will scale.
This article addresses four points. First, we examine recent OCC developments relevant to crypto-related, banking-adjacent activities, including custody, payments, stablecoin reserve services, and on-chain operations. Second, we outline why a fintech may actively seek an OCC charter in the current environment, especially after the passage of the Genius Act. Third, we survey the states moving quickly on stablecoin legislation and the first-mover advantages they and businesses operating under state law regimes seek. Finally, we examine how the pathway a business chooses now will help shape market access and competitive positioning in the future.
OCC fintech charters and crypto: Where the perimeter sits now
In the past several years, the OCC has both consolidated and selectively expanded the boundaries of bank-permissible activities in digital assets through its interpretive letters.
- Interpretive Letter 1170 confirmed that banks may provide crypto-asset custody services as part of the business of banking, including settlement, execution, recordkeeping, and valuation in connection with offering such services.
- Interpretive Letter 1172 noted that banks may hold dollar deposits as reserves backing certain stable-coins.
- Interpretive Letter 1174 explained that banks may validate and settle payments by serving as nodes on distributed ledgers and may use distributed-ledger technology and related stablecoins to carry out other bank-permissible payment activities, provided they are conducted in a safe and sound manner consistent with applicable law.
- In 2021, the OCC conditioned those authorities through Interpretive Letter 1179, which required written non-objection from supervisory staff before launching crypto activities, such as custody, stable-coin reserve services, or distributed-ledger-based payment activities.
- In March 2025, however, the OCC rescinded that preclearance step through Interpretive Letter 1183. By doing so, the OCC indicated that a formal non-objection is not a per se prerequisite for undertaking otherwise permissible activities.
- In May 2025, Interpretive Letter 1184 clarified that banks may buy and sell assets held in custody at a customer’s direction and may outsource bank-permissible crypto-asset activities – including custody and execution – to third parties, subject to existing expectations for third-party risk management.
- In November 2025, Interpretive Letter 1186 ad-dressed two operational necessities for banks engaged in permissible crypto activities: holding small amounts of native assets as principal to pay block-chain network fees and holding native tokens needed to test otherwise permissible crypto platforms.
With respect to Interpretive Letter 1186, the OCC reasoned that paying on-chain network fees is incidental to the business of banking, where it directly facilitates an already permissible banking activity, and that the ability to test production-grade platforms is essential to safe and sound operations.
- In December 2025, in Interpretive Letter 1188, the OCC concluded that buying and selling crypto for customers in instantaneous back-to-back transactions fit within established intermediary powers long recognized for other asset classes. The letter indicates that customer-driven brokerage-like activities in crypto can be assimilated to familiar banking functions, provided the attendant settlement, custody, and operational risks are controlled, and holdings are incidental and transitory.
Taken together, the OCC’s letters reinforce that crypto-related activities are permissible when they are functionally equivalent to core banking services, which may include custody, payments validation and settlement, and the incidental holdings or operational steps necessary to perform those services safely and efficiently. The practical result is that a national bank or national trust bank can now consider implementing end-to-end client offerings in digital assets within their risk governance framework.
Why a fintech may seek an OCC charter now – and how the Genius Act reframes the calculus
Obtaining a national charter allows a business to gain certain operational efficiencies, namely, having a uniform set of rules and access to a national scale. In the wake of the Genius Act and the OCC’s updated guidance, many fintech businesses are now seeking to take advantage of those efficiencies by applying for a national trust bank charter.
A national trust bank charter subjects a firm to ongoing OCC examination and prudential governance expectations, with clear standards for third-party risk, operational resilience, and financial crimes compliance. That supervisory imprimatur may be a market differentiator. Institutional counterparties, market infrastructure operators, broker-dealers, asset managers, and public-company treasuries may increasingly prefer to interact with federally supervised digital asset services providers. For stablecoin issuers, a federal charter can signal that reserves, redemption mechanics, disclosures, and consumer protections will be managed within a recognized prudential regime.
After OCC Interpretive Letters 1184 and 1186, a national bank or national trust bank can develop digital asset ser-vices in a manner that has underpinnings in the law and is operationally coherent. These services may include tokenized payment flows backed by bank-managed or bank-supported reserves; customer-directed token transactions executed by a supervised intermediary; and on-chain operations delivered without relying on unsupervised fee intermediaries. For corporate treasuries and financial intermediaries seeking through-processing, the ability to maintain custody, execution, and on-chain operations within a single supervised perimeter reduces operational risk and vendor fragmentation.
These developments align with the July 2025 Genius Act. The Act establishes the first comprehensive federal framework for payment stablecoins, delineating, among other things, who may issue stablecoins and how reserves must be held.[1] The Act assigns the OCC a central role in super-vising qualified federal issuers and implementing rules. For issuers that aspire to operate on a national scale, the Genius Act establishes the OCC-supervised pathway as the default platform for compliant issuance, distribution, and reserve management. As the OCC builds out implementing rules in coordination with Treasury, national banks and national trust banks will be positioned to obtain approvals, demonstrate compliance, and interface seamlessly with other federal regulators and payment systems.
While a national trust bank charter does not preempt all state-level consumer laws, it does consolidate core activities under a single prudential regime and generally displaces money transmission licensing for activities conducted as a fiduciary. For businesses contemplating multi-state operations, a national charter can sharply reduce complexity, cycles to market, and the ongoing costs of regulatory change management.
Early entrants under the OCC umbrella will likely be able to help shape supervisory expectations in areas such as tokenized collateral, stablecoin use in payment and settlement, and the interface between bank nodes and public blockchains. Early engagement has the potential to create durable advantages: control over definitions, pragmatic thresholds for de minimis token holdings to pay network fees, and scalable models for third-party outsourcing and oversight.
In short, the combined effect of the OCC’s interpretive architecture and the Genius Act is that federal charters now serve as a functional operating system for scaling bank-permissible digital asset activities and payment stable-coin businesses. For fintechs that anticipate meaningful stablecoin involvement – whether as issuer, reserve manager, distributor, or payment facilitator – the center of gravity appears to have moved to the OCC-supervised lane.
States move first on stablecoins: Who is acting and why it matters
Even as the federal framework takes shape, several states have advanced their own stablecoin initiatives to promote local innovation and shape the contours of federal-state interaction. Two developments are particularly salient.
In March 2023, Wyoming enacted the Wyoming Stable Token Act, establishing a commission to issue a state-backed stablecoin. In August 2025, the state launched the Frontier token across multiple blockchains and promulgated implementing rules on reserves, procurement, public records, and technical controls, including supply management and emergency freeze capabilities. The commission’s rule-writing process has created a mechanism that permits seizure or temporary suspension of token access only with a judicial decree, with a narrow, time-limited emergency freeze option in exigent circumstances pending court order. Additionally, because the Genius Act focuses on “persons” and does not clearly encompass states or state agencies, Wyoming’s working view is that its government-issued token sits outside the federal statute. No definitive federal rule, however, has resolved the question. The result is a live testbed: a state using its public lawmaking power to craft a payment token regime that both borrows from and stands apart from private issuer models.
North Dakota has also entered the stablecoin sphere, introducing the Roughrider token through a partnership between Fiserv and the state-owned Bank of North Dakota. The Roughrider token is aimed at bank-to-bank and behind-the-scenes use cases. Conceptually, it pilots institutional settlement, bank-facing liquidity improvements, and operational efficiency gains, with the state’s own bank acting as an anchor institution. In contrast to private issuers, the state’s infrastructure and public ownership may give counterparties confidence in the reserve integrity and operational continuity for selected use cases.
Other states, including Nebraska, have also developed state legislative regimes for stablecoins. Through these types of actions, states are pre-positioning themselves for a world in which payment stablecoins become an accepted rail for commerce, tax payments, disbursements, and interbank clearing. Several incentives drive this:
- Regulatory branding and jurisdictional magnetism. First movers can attract issuers, developers, and service providers seeking clarity and speed.
- Local public finance and service modernization. A state-issued token can streamline inflows (taxes, fees) and outflows (benefits, vendor payments), re-duce card and ACH (Automated Clearing House) costs, and support 24/7 settlements for government transactions.
- Institutional use cases and regional bank enablement. State-owned or state-chartered financial institutions can experiment with tokenized settlement inside a controlled perimeter, demonstrating risk-managed models that community and regional banks can adopt. This aligns with the federal goal of avoiding a stablecoin market with only a few large players.
- Reserve control and law enforcement posture. States can specify reserve assets, custodial arrangements, and redemption mechanics; they can also tailor lawful processes for freezing and seizing assets to balance user protections within constitutional constraints.
- Hedge against federal timelines and interpretations. While the OCC and Treasury implement the Genius Act, states can advance their policy preferences and shape de facto standards.
The result is not only a domestic network of compliant, stable-value instruments but also a foundation for cross-border interoperability, where state-issued or state-supervised tokens become accepted collateral, settlement media, or payment instruments in a broader ecosystem. States also anticipate that custody providers, compliance vendors, and developer communities will want to work within a clear regulatory framework, enhancing the local fintech economy.
For private stablecoin issuers, state regimes offer tactical speed-to-market. New York’s virtual currency regime historically provided a path to launch with clear supervisory expectations for reserves and redemption. Wyoming and other state regimes provide an alternative posture anchored in administrative rulemaking. Firms can seek state approval while positioning for federal authorization under the Genius Act, allowing early product-market fit, pilots with financial institutions, and the refinement of compliance operations. That sequencing can accelerate learning and prepare a stronger record for OCC review, whether the firm ultimately pursues a national trust charter or operates alongside a bank partner.
How these developments interrelate – and why strategy now determines scale later
The OCC’s stance, the Genius Act, and the state legislative developments are interlocking gears. Understanding their interplay is critical to choosing the right charter strategy and product architecture.
The Genius Act made stablecoin oversight a federal responsibility, with the OCC occupying a central supervisory role for qualified federal issuers. But early state regimes will influence the baseline expectations for reserves, redemption, disclosures, and lawful process (e.g. seizure/freeze mechanics), especially if state tokens or supervised private issuers gain meaningful adoption before federal rulemaking is completed. In practice, OCC rules will interface with state operational realities – how banks interact with state-issued stablecoins, whether national banks can support distribution or custody for such tokens, and under what conditions nodes operated by banks may validate transactions involving them.
Recent OCC guidance continues to lower operational friction that previously slowed bank participation in this marketplace. Interpretive Letters 1184 and 1186 remove common roadblocks to building end-to-end offerings, permitting customer-directed execution in custody, out-sourcing, network-fee payment facilitation, and controlled testing. National banks and national trust banks can now deliver client experiences that compare favorably to crypto-native intermediaries while retaining the risk discipline and supervisory comfort valued by institutional wallets, asset managers, and corporate treasuries. As federal stablecoin rules go live, those operational authorities will be essential for banks to intermediate tokenized payments, manage reserves, or serve as distribution channels for qualified issuers.
For stablecoin issuers, a national trust charter offers a single federal supervisor, facilitating national scale and acceptance in regulated venues. For fintechs building payments and custody workflows, partnering with or becoming a national trust bank provides a direct line of sight to the OCC’s evolving expectations under the Genius Act. If issuers are operating within a state regime, markets may examine criteria demanded by state regulation, such as demonstrable reserve quality, auditable controls, and constitutional process – features that Wyoming has emphasized. The decision on how to proceed embeds a particular compliance and product design path – one that governs whether yield features are permissible, how on-chain operations are executed, and how reserves are held and disclosed.
Competitive dynamics hinge on perceived safety and regulatory coherence. Institutional adoption will likely follow the path of least regulatory friction and greatest operational predictability. A stablecoin held in custody by a nationally supervised trust bank and transactable through bank-operated nodes on public blockchains will look far less exotic to risk committees than a purely private, lightly supervised instrument. Conversely, a state-issued token with clear constitutional safeguards, robust reserves, and integration with public finance may gain acceptance for public payments and vendor networks faster than private alternatives. Firms that position themselves at the nexus – federal charter plus state interoperability – will have outsized advantages in distribution and cross-rail liquidity.
Yield remains a fault line – and a design constraint. The Genius Act’s prohibition on issuers offering yield for holding or using tokens alters the economic calculus of stablecoin distribution and retention. To the extent affiliates or third parties can offer rewards without violating the statute’s letter or spirit, the OCC will focus on whether those arrangements create functional deposit substitutes that implicate safety and soundness concerns. State regimes – particularly where the state itself is the issuer – may take distinct positions on yield-like features, but private actors will need to remain attentive to both federal and state securities and consumer laws.
Finally, litigation risk is real. Banking trade groups have signaled potential Administrative Procedure Act challenges if OCC approvals for crypto-focused national trust banks are perceived to stretch Section 27(a) of the National Bank Act beyond fiduciary and custody functions. Applicants should expect heightened scrutiny of whether their proposed businesses are “primarily engaged” in fiduciary activities, and of how nonfiduciary functions (e.g. settlement facilitation or reserve management support) are structured. The stronger and more traditional the fiduciary spine – custody, trustee, registrar, investment adviser – the sturdier the charter is likely to be. The OCC’s interpretive letters are important: they ground permissibility in usual banking powers, emphasizing incidental activities rather than wholesale expansion into digital asset trading.
Putting the pieces together, the near-term picture includes the following: states will continue to pilot token models tailored to their public and regional banking needs; the OCC will continue to refine the perimeter of bank-permissible activities on-chain; and the Genius Act will define federal authority for payment stablecoins while leaving design room for state experimentation and bank intermediation. For fintechs and issuers, the decision to pursue an OCC charter is increasingly tied to the payment stablecoin the-sis, namely, that stablecoins will anchor tokenized payments, collateral, and settlement, and that the federal lane appears to offer a credible and scalable path to participate – provided the business sits squarely within the fiduciary core and is implemented with the risk disciplines examiners expect.
Conclusion
A durable architecture for digital assets inside the US financial system is rapidly taking shape. The OCC’s latest interpretive letters – especially Interpretive Letters 1184 and 1186 – show how on-chain operations can be harmonized with traditional banking law and authority. The Genius Act installs a federal framework for payment stablecoins, elevating the OCC as a central supervisor and clarifying prohibitions that will shape product economics. States, such as Wyoming and North Dakota, are operationalizing stablecoin regimes that both reflect and inform the emerging federal consensus.
For lawyers and professionals advising on charter strategy, the key is to fit business models within these emerging supervisory pathways. That can include designing around fiduciary primacy for national trust banks; embedding robust governance and third-party risk management; engineering custody and execution stacks that can pass examiner muster; and, for stablecoins, aligning reserve and redemption mechanics to the Genius Act and federal rulemaking as it matures. It is also critical to consider state regimes as both staging grounds and strategic partners – interoperable layers where public finance and regional banks can pilot tokenized flows that federally supervised institutions will ultimately support at scale. The convergence of federal and state regimes is a scaffold for the next payment rail. Businesses that internalize that structure now – and align their charters, products, and compliance strategies accordingly – will likely be able to set the standards that others must follow.
[1] We note an area that remains in flux. The Genius Act prohibits issuers from offering yield or rewards for holding, using, or retaining payment stablecoins. Certain members of the industry are advocating that the prohibition either covers or should be reformed to extend to affiliates of issuers and to third parties who provide payment stablecoin services.
