With regulatory headwinds shifting under the Trump administration, fintech and crypto firms are applying for bank charters at an accelerating rate. The move is driven by the need to:
Reduce borrowing costs by leveraging customer deposits
Gain legitimacy in the eyes of investors and regulators
Expand business opportunities with a national banking license
Compete with traditional financial institutions
Since regulators have historically been slow to approve new charters, industry players are now cautiously optimistic that Trump’s pro-business stance could change the landscape.
Bank Charters: A Path to Cheaper Capital and Credibility
Becoming a bank comes with stricter regulatory oversight, but it also lowers operational costs. Firms with a charter can:
Reduce dependency on high-interest borrowing
Expand their financial services without intermediaries
Attract more conservative customers who trust traditional banking structures
“Online companies know that they will be coming under greater regulatory scrutiny,” said Carleton Goss, a partner at Hunton Andrews Kurth. “Getting ahead of the curve by applying for a charter makes sense—it provides more credibility and access to lower-cost capital.”
Fintech’s First Big Win: SmartBiz Acquires Centrust Bank
The Office of the Comptroller of the Currency (OCC) recently approved fintech firm SmartBiz’s acquisition of Centrust Bank, marking the first fintech bank charter approval since 2021.
Why It Matters:
- It signals a potential regulatory shift in favor of fintech firms
- More companies may follow suit, increasing competition in the banking sector
- Crypto and digital banking startups may see new growth opportunities
The Roadblocks: Will Regulators Open the Floodgates?
Despite renewed interest, the number of new bank charter approvals remains historically low.
Between 2010 and 2023, an average of only five bank charters were granted per year—compared to 144 annually from 2000 to 2007.
Regulators remain cautious about allowing crypto-heavy firms into the traditional banking system
Approval timelines are uncertain, making some firms hesitant to proceed
State vs. national charters pose strategic decisions for applicants
What’s Next? Crypto Banks on the Rise?
The fintech and crypto sectors are at a turning point. If more firms successfully obtain bank charters, the industry could see:
Crypto-native banks competing with Wall Street
More fintech acquisitions of community banks
Greater acceptance of digital assets in mainstream finance
With the Trump administration’s stance on digital finance, the next few months could determine whether crypto banks become the norm—or remain an exception.