It looks like Bit Pay – a bitcoin and crypto payments company – is looking to set up its own bank. The company recently filed paperwork with the US Currency Manager’s Office (OCC) to establish Bit Pay National Trust Bank.
Will a Pay Bank soon have its own Bank?
In fairness, this is not the first time that standard crypto and banking services – if the paperwork is approved – have been merged together. The first news came several months ago that many banks have been given the green light to offer crypto custody services to their customers. In addition, we are seeing several standard payment systems – like PayPal – now offering cryptocurrencies to their customers and giving them the opportunity to not only buy digital assets but gain access to products and services with these assets.
However, this it can could be one of the first times when a crypto bank could be set up. For the most part, cryptocurrency and banking systems do not always go hand in hand. Standard banks often have too much say in who gets access to their services. They look at things like someone’s credit and job history and make decisions based on these factors about who can step inside and who can’t.
In addition, banks often issue central government-controlled fiat currency rather than the people themselves.
In contrast, many of these things are not bothered by bitcoin and crypto. If you’re unemployed or you’re from a foreign country … These things are not explored. All that matters is if you have access to a digital wallet and have a valid payment method attached to that wallet. From there, you can start trading without having a vulture breathing down your throat all the time. Moreover, bitcoin is designed to give one financial independence as it is devolved and not controlled by the government.
It will be interesting to see what Bit Pay will do with its new bank. Will it be centralized and go against crypto ideals, or will it be more on the people side, and how can it do so as a legitimate financial institution? Won’t there be certain rules to follow?
Eden Doniger – Bit Pay’s general counsel and chief compliance officer – explained in a statement:
This is the first step of many on our journey to launch a chartered institution … The OCC is at the forefront of government regulation of the cryptocurrency industry. We commend the OCC’s leadership in recognizing the need for innovation to facilitate the regulation of cryptocurrency participants at a national level.
Should the bank get the green light, it will be located in the city of Alpharetta, Georgia, according to the paperwork filed. The documents will now be subject to a 30-day comment period, during which the OCC will hear arguments for and against Bit Pay plans.