Rain Seeks U.S. National Trust Bank Charter as OCC Faces Community Bank Lawsuit

Rain, a stablecoin payments infrastructure provider, has applied to form a national trust bank in New York, a step that would bring more stablecoin and digital-asset activity under oversight of the U.S. Office of the Comptroller of the Currency (OCC). In a filing made Monday, the company said it submitted an application to establish "Rain National Trust Bank." If approved, the proposed institution would aim to provide fiduciary custody of digital assets and U.S. dollars for institutional clients, manage reserves for permitted stablecoin issuers, and issue and redeem dollar-backed stablecoins in line with the framework of the GENIUS Act. Rain also disclosed proposed leadership for the bank. The company said Brandon Soto, formerly chief financial officer of Square Financial Services, would serve as president and chief executive officer, subject to OCC review. Rain CEO and co-founder Farooq Malik said customers "building on Rain" want the assets backing their programs held by a fiduciary accountable to a federal regulator. For market participants, a federal trust charter could reshape how stablecoin custody and reserve arrangements are structured, offering a different compliance and governance model than third-party custody or off-balance-sheet setups. Rain's move comes amid a broader push by crypto and payments firms seeking national trust bank charters. Modern Treasury, a payments infrastructure company, said Monday it also filed an application to provide digital-asset custody and related fiat services, underscoring growing interest in regulated banking structures that can support fiat handling and custody in a way that is more familiar to traditional finance. The charter push is unfolding as community banks mount legal resistance. On Friday, the Independent Community Bankers of America (ICBA) sued the OCC in the U.S. District Court for the District of Columbia, naming the agency and Comptroller Jonathan Gould. The trade group argues the OCC exceeded its authority by allowing nondepository trust banks to conduct activities it says go beyond the proper scope of a trust charter. ICBA's complaint challenges the OCC's National Bank Chartering final rule and an interpretive letter (1176, 2021), claiming they "perversely allow entities engaged in highly risky cryptocurrency and digital assets activities to enter the banking system under lightly regulated national charters rather than the more rigorously regulated traditional bank charter." The lawsuit raises two main concerns: that crypto-focused trust banks could gain a competitive edge by offering overlapping services with community banks while facing fewer obligations, and that consumers may misread the "national bank" label as implying federal insurance protections that do not apply in the same manner as they do for insured depository banks. ICBA asked the court to overturn the OCC's March 2026 chartering rule and the 2021 interpretive letter, and to block additional charter approvals that rely on them. Crypto policy groups pushed back. On Monday, the Crypto Council for Innovation criticized the lawsuit as an effort to slow regulated innovation. ICBA's complaint says the OCC has approved or conditionally approved at least 21 trust banks, including at least 13 tied to crypto companies. Uncertainty remains over how courts will assess the OCC's chartering authority and what any ruling could mean for pending applications, conditional approvals, and the standards applied to future filings. Investors and builders are likely to watch two tracks: the OCC's review of Rain's application and the outcome of the ICBA challenge that questions the legal foundation for crypto-related trust charters. Together, they could shape the pace—and durability—of federally supervised banking rails for stablecoin services.