Rain Seeks U.S. National Trust Bank Charter as OCC Crypto Licensing Faces Court Challenge

Rain has applied for a U.S. national trust bank charter, a move that would place key parts of its stablecoin and custody operations under federal oversight even as the Office of the Comptroller of the Currency (OCC) faces litigation over crypto-related trust bank approvals. According to CoinDesk, Rain’s application would create Rain National Trust Bank. If approved by the OCC, the proposed institution would be permitted to custody digital assets, manage stablecoin reserves, and issue U.S. dollar-backed stablecoins. Rain said the new entity would be headquartered in New York and structured as a separately capitalized subsidiary regulated by the OCC, while Rain itself would remain a stablecoin payments platform and would not convert into a bank. Rain emphasized that the proposed trust bank would not resemble a traditional retail lender. It would not accept deposits, offer checking or savings accounts, provide consumer accounts, or make commercial loans. The bank would operate as an uninsured national trust bank and would not carry Federal Deposit Insurance Corporation (FDIC) deposit insurance. Rain also said assets held in custody would remain customer assets rather than becoming bank liabilities, and that reserves backing any stablecoins issued by the proposed entity would not be pledged, lent, or reused. If approved, Rain said the bank would focus on three institutional business lines: fiduciary custody of approved digital assets and U.S. dollars with customer assets segregated from the bank’s own; reserve management for approved stablecoin issuers; and potentially acting as a registered issuer of U.S. dollar-backed stablecoins under the federal GENIUS Act. Under that law, the proposed bank may manage reserves for approved stablecoin issuers. Rain CEO and cofounder Farooq Malik said customers using the company’s infrastructure want the assets underlying their projects held by a custodian supervised by a federal regulator. Rain currently provides infrastructure for stablecoin cards, wallets, and transfers, and said its partners serve millions of end users. The company noted that many partners currently rely on a mix of state-level licenses, external custodians, and third-party stablecoin issuers, and that a federal trust bank could consolidate some of those functions. Rain nominated Brandon Soto to serve as President and Chief Executive Officer of the proposed bank, subject to OCC review. Soto previously was Chief Financial Officer of Square Financial Services, a state-chartered industrial bank owned by Block, and later served as Chief Financial Officer of Coastal Financial Corporation. Rain said it worked with law firm Paul Hastings to prepare the application. The filing comes as community bankers challenge the OCC’s legal framework for national trust bank charters tied to crypto activities. Three days before Rain submitted its application, the Independent Community Bankers of America (ICBA) sued the OCC in federal court. On October 2, ICBA filed suit against the OCC and Comptroller Jonathan Gould in the U.S. District Court for the District of Columbia in “Independent Community Bankers of America v. Office of the Comptroller of the Currency,” docket number 1:2026cv03441, before Judge Carl J. Nichols. The complaint targets a rule issued by the OCC in March 2026, Interpretive Letter 1176, and the conditional approval granted to Protego Holdings. ICBA argues the OCC has exceeded its statutory authority by allowing national trust banks, under a limited-purpose charter, to conduct nonfiduciary activities beyond traditional fiduciary services. The claims have not been adjudicated. ICBA is asking the court to declare the March rule and Interpretive Letter 1176 unlawful, block further approvals under the contested framework, and rescind Protego’s conditional charter approval. The OCC has said its approach does not expand its powers. In its February announcement introducing the rule, the agency said the change clarifies longstanding authority to permit national trust banks to engage in nonfiduciary activities while conducting fiduciary business, and stated the rule neither expands nor narrows its chartering authority. The rule took effect on April 1. Banking Dive reported an OCC spokesperson said Monday the agency does not comment on litigation. Comptroller Gould has said the OCC evaluates whether applicants have a reasonable chance of success rather than applying a “zero-risk” standard. Rain’s application is now under OCC review and a public comment period. The company said the review will include a public comment process and that the public portion of its application is expected to be posted on the OCC’s website. Rain did not provide a timeline for a decision and said the regulator will proceed on its own schedule. Rain added that its National Trust Bank project is a multiyear initiative and that its existing card, wallet, and funds transfer services will continue while the OCC review proceeds, with the proposed bank not launching until all required approvals are secured. Rain’s filing also aligns with a broader wave of applications from digital asset and payments firms seeking federal permissions for custody, settlement, and stablecoin-related activities without taking traditional deposits. Circle advanced furthest in July, when the stablecoin issuer received final OCC approval for First National Digital Currency Bank, operating as Circle National Trust, which was expected to begin with fiduciary digital asset custody services and potentially expand to select institutional clients. Other applicants remain in process: Agora received preliminary conditional approval in September after applying in April, and Zerohash submitted a revised application in August after the OCC returned an earlier submission.