OCC grants crypto firm Paxos ‘conditional approval’ for US banking charter – Reuters
Digital currency and stablecoin issuer Paxos has been granted conditional approval for a banking charter under the Paxos National Trust in New York. The U.S. Office of the Comptroller of the Currency has issued preliminary conditional approval, meaning the regulator has yet to clear the company’s future banking plans.
Paxos Obtains Preliminary Conditional Approval for a US Banking Charter
The New York-based financial institution and technology company Paxos has obtained preliminary conditional approval for a bank charter by the Office of the Comptroller of the Currency (OCC). The CCO published information on conditional approval on April 23, 2021, showing authorization of the company’s application to charter the Paxos National Trust.
“The OCC granted a national fiduciary bank charter to Paxos after [a] comprehensive review of the company and its current operations,” the OCC press release noted. “In granting this charter, the OCC has applied the same rigorous review and standards applied to all charter applications. The OCC granted preliminary conditional approval to Paxos after [a] in-depth review of its application.
Paxos was founded in 2012 in New York, but the company also has offices in Singapore and London. At the end of December 2020, documents show that Paxos has raised approximately $240 million in funding since the company was founded. Paxos is also known for issuing a stablecoin based on the value of the US dollar and a token backed by precious metal gold as well. Preliminary approval status is intended to give Paxos authority to exercise fiduciary powers under 12 USC 92a and 12 CFR 5.26.
Paxos National Trust must get final approval from regulator
Paxos General Counsel Dan Burstein is addressed in the OCC pre-approval letter. The letter from the OCC points out that the regulatory entity plans to conduct background checks and other examinations of Paxos executive staff.
“As a result, the continued service of these individuals will be dependent on the satisfactory completion of the background investigation process,” the OCC letter states.
“Before the opening of the Bank,” concludes the letter of approval from the OCC. “The bank must obtain the OCC’s prior written decision of no objection for any additional organizers or officers or directors appointed or elected before the person assumes the position.” Additionally, if the OCC discovers issues, it may modify, suspend, and rescind the Preliminary Terms if material information changes prior to the OCC’s final decision.
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