Anchorage Becomes First Ever Federally Chartered Digital Asset Bank
Last month represented a major breakthrough for the future of the cryptocurrency economy: the Office of the Comptroller of the Currency (OCC) approved the conversion of Anchorage Trust Company, chartered in South Dakota, to become Anchorage Digital Bank National Association, a federally chartered trust company. Anchorage’s receipt of this national trust charter represents a critical milestone for the crypto industry in that Anchorage is now the first federally chartered digital asset bank in history. As a federally chartered bank with fiduciary powers, Anchorage unambiguously meets the requirements set forth by the definition of a qualified custodian under federal law. In a blog post announcing the news, Anchorage explained that “having a national bank charter places Anchorage Digital Bank firmly on the same regulatory footing as other national banks in the country. Most immediately, it puts first-of-its-kind, sub-custody services within reach for any traditional financial institution that wishes to give its clients access to digital assets.”
Operating in South Dakota as a non-depository public trust company since 2019, Anchorage has a track record of safely and soundly providing technically-complex crypto-native financial services pursuant to South Dakota’s banking laws and regulations. With the OCC’s approval of Anchorage’s conversion to a national trust charter, a process that has been completed numerous times by legacy financial institutions, Anchorage may now provide these same services across the nation — without having to navigate the patchwork, state-by-state bank charter system. Anchorage Digital Bank, which will be a member of the Federal Reserve System and may apply for a master account, will primarily offer custody services and will not engage in lending or deposit-taking.
In a statement accompanying the conversion, the OCC stated that “by bringing [Anchorage] into the federal banking system, the bank and industry will benefit from the OCC’s extensive supervisory experience and expertise. At the same time, the Anchorage approval demonstrates that the national bank charters provided under the National Bank Act are broad and flexible enough to accommodate evolving approaches to financial services in the 21st century.”
Cryptocurrencies and blockchains are driving the next major wave of innovation in financial services. To retain its position as the world’s financial leader, the U.S. must remain at the forefront of innovation. The Blockchain Association has long argued that the inherently borderless cryptocurrency industry demands a unified national regulatory approach, not a piecemeal, state-by-state regime, in order to be properly supported and regulated. As such, the association welcomes the issuance of the first federal digital asset bank charter as an important step forward in the modernization of the national banking system.