It looks like Bit Pay – a bitcoin and crypto payments company – is looking to establish its own bank. Recently, the company filed paperwork with the U.S. Office of the Comptroller of the Currency (OCC) to establish the Bit Pay National Trust Bank.
Will Bit Pay Soon Have Its Own Bank?
To be fair, this won’t be the first time that crypto and standard banking services – should the paperwork be approved – are fused together. News first came several months ago that many banks had received the greenlight to offer crypto custody services to their customers. In addition, we are seeing several standard payment systems – such as PayPal – now offer cryptocurrencies to their customers and give them the opportunity to not only purchase digital assets but gain access to products and services with these assets.
However, this may be one of the first times when a crypto bank could be established. For the most part, cryptocurrency and banking systems don’t always go hand in hand. Standard banks often have too much say regarding who gains access to their services. They look at things like one’s credit and job history and make decisions based on these factors regarding who can step inside and who cannot.
In addition, banks will often issue centralized fiat currencies that are controlled by the government rather than by the people themselves.
By contrast, bitcoin and crypto doesn’t care about a lot of these things. If you’re unemployed or if you’re from a foreign country… These things are not examined. All that matters is if you’re able to get a digital wallet and if you’ve got a valid payment method attached to that wallet. From there, you can begin trading without having a vulture breathing down your neck all the time. Furthermore, bitcoin is designed to give one financial independence as it is decentralized and not government controlled.
It will be interesting to see what Bit Pay will do with its new bank. Will it be centralized and go against the ideals of crypto, or will it be more on the side of the people, and how can it do that as a legitimate financial institution? Won’t there be certain rules to follow?
The Next Steps…
Eden Doniger – Bit Pay’s general counsel and chief compliance officer – explained in a statement:
This is the first step of many on our journey to launch a chartered institution… The OCC is at the forefront of government regulation of the cryptocurrency industry. We applaud the OCC’s leadership in recognizing the need for innovation to facilitate regulation of cryptocurrency participants at a national level.
Should the bank get the greenlight, it will be stationed in the city of Alpharetta, Georgia, according to the paperwork filed. The documents will now be subjected to a 30-day commenting period, in which the OCC will hear arguments for and against Bit Pay’s plans.