The Independent Community Bankers of America (ICBA) has taken its long-running fight against special-purpose crypto banks to federal court. In a lawsuit filed Friday (Oct. 2) in federal district court in Washington, the ICBA argued that the Office of the Comptroller of the Currency (OCC) is allowing cryptocurrency companies to obtain the benefits of national bank charters without assuming many of the regulatory obligations imposed on traditional banks.

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The lawsuit, which also named Comptroller Jonathan Gould, challenged the agency’s authority to charter cryptocurrency companies that neither take deposits nor primarily perform traditional fiduciary functions as national trust banks. The suit also challenged a March OCC rule, a 2021 interpretive letter and the agency’s conditional approval of a charter for crypto firm Protego Holdings.

According to a Monday (Oct. 5) analysis by law firm Ballard Spahr, the case puts a new legal front on a broader dispute between traditional banks and the crypto industry over what banks have long characterized as an uneven regulatory playing field. Community banks face deposit-insurance assessments, Community Reinvestment Act requirements, capital and liquidity rules and other federal obligations that do not necessarily apply to non-depository national trust banks.

At issue is Section 27(a) of the National Bank Act, which says a national bank is not illegally constituted simply because the OCC limits its operations to those of a “trust company and activities related thereto.”

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