Crypto Firms Push for Bank Licenses in Shift Toward Compliance
Following years of exclusion from traditional finance, crypto firms are once again attempting to re-enter the global banking system, and this time, they are following strict guidelines.
Leading digital asset companies, including Circle, the issuer of USDC stablecoins, and BitGo, a major crypto custody provider, are preparing to apply for bank charters and financial licenses across the United States and Europe, according to multiple sources familiar with the plans.
The shift reflects a strategic pivot by the crypto industry, one that recognises that survival and growth may hinge on regulatory compliance and integration with the same financial system that once kept it at arm’s length.
“Crypto is not looking to replace the banking system; it’s looking to become part of it,” said a senior executive at a firm preparing to submit a digital banking application in Switzerland.
Circle Leads the Push
Circle has publicly confirmed that it is pursuing a full-reserve banking licence in the U.S., a move that would allow it to hold customer deposits directly at the Federal Reserve. The firm’s CEO, Jeremy Allaire, says the goal is to establish trust and transparency in the stablecoin sector, especially after the collapse of rivals like Terra and the regulatory scrutiny faced by Tether.
“We want to build a bridge between crypto and the traditional banking world, one that’s compliant, regulated, and resilient,” said Allaire in a recent Bloomberg interview.
Circle is also reportedly in talks with regulators in the UK and the EU, aiming to expand USDC’s footprint in Europe’s emerging MiCA-regulated market.
BitGo Eyes Custody Licenses
Custody provider BitGo is taking a similar route. The firm has applied for a trust charter in New York and is exploring a payment institution licence in Luxembourg to support institutional crypto settlements.
BitGo, which serves hedge funds, corporates, and exchanges, has said the move is necessary to future-proof its business as institutional clients demand fully regulated infrastructure to meet compliance mandates.
“Crypto custody isn’t optional anymore; it’s core financial plumbing,” said BitGo CTO Chen Fang.
A Shift in Tone from Regulators
The banking push comes as regulators soften their tone following the 2024 U.S. election and MiCA's implementation in Europe. While outright hostility toward crypto has faded, access to basic financial services, including bank accounts, remains a major hurdle for even large, well-funded crypto companies.
Some regulators are warming to the idea of crypto banks, especially if they operate with full reserves and strict auditing. But others remain cautious, fearing contagion risk and gaps in consumer protection.
A New Chapter Begins
The crypto industry's pursuit of banking licences marks a new chapter in its maturation, one defined less by rebellion and more by integration. If successful, it could establish the foundation for the development of crypto-native banks, tokenised financial services, and a future where blockchain and fiat coexist under a single regulatory framework.