In a post-publication statement, Paige Pidano Paridon, executive vice president and co-head of regulatory affairs at the Bank Policy Institute, said the group supports the introduction of innovative products and services into the regulated banking system when the entities involved are held to the same rules and responsibilities as other chartered banks.
“Firms should only receive trust charters if their activities are limited to trust functions,” Paridon said. “If they wish to conduct traditional banking, they should pursue full-service bank charters. Uniform, rigorous standards are essential to a competitive, safe and resilient banking system.”
Banking regulators have credited the growing number of national trust charters with contributing to a recent resurgence of new bank formations after a long dry spell.
Some of the trusts have been established with a crypto focus, including Protego and Erebor. Others have been obtained by prominent existing crypto companies, including Coinbase, Circle and Crypto.com.
A recent addition is World Liberty Financial, a firm partly owned by President Donald Trump and his family. Its charter approval attracted criticism from opponents, including Democratic Sen. Elizabeth Warren, who alleged that the regulator was enabling presidential corruption and wrote on X that the new charter was “giving him and his family a new way to profit.”
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