An Open Letter to Senator Warren Re: OCC Charters and Digital Asset Banking

May 19, 2026
The Honorable Elizabeth Warren
Ranking Member
Committee on Banking, Housing, and Urban Affairs
United States Senate

Dear Senator Warren @SenWarren:

I write in response to your May 18 letter to Comptroller Gould (@USComptroller) regarding the Office of the Comptroller of the Currency's (@USOCC) recent approvals of national trust charters, including BitGo's. As the CEO of one of the companies you named, I owe you a direct and substantive response. I write this as an open letter because the questions you raise about fiduciary duty, financial stability, consumer protection, and the appropriate scope of federal bank supervision deserve to be discussed openly and on the merits.

Let me say at the outset what I expect we agree on. The collapse of FTX, Celsius, Voyager, BlockFi, and Genesis caused enormous harm to ordinary Americans. Customer assets were commingled with corporate balance sheets, lent out, traded against, and ultimately lost. Whatever else those failures were, they were a failure of custody — and a failure of supervision. We agree that this asset class needs serious regulation, that consumers need real protection, and that the institutions handling client property need to be held to standards that match the responsibility.

Where I think we disagree is on what kind of institution provides that protection, and on whether the national trust charter, which is what BitGo operates as, is the wrong answer or, as I will argue, the right one. With respect, I believe the framing of your letter rests on a series of premises that do not hold up to examination. I want to address each of them.

1. What is a "crypto bank"?

Your letter rests on a phrase, "crypto bank," that has no definition in law. It does important rhetorical work in your argument, but before we go further it is worth asking what it actually means.

If by "crypto bank" you mean an institution that takes customer crypto deposits, pays interest on them, and lends those assets out at risk and at various durations to third parties, I agree completely that such an institution is engaged in the business of depository banking (also known as fractional reserve banking) and should be regulated as such. BitGo does none of those things. We do not take deposits. We do not lend customer assets. We do not commingle. Every coin we hold belongs to the client whose name is on the account, stored in a segregated, bankruptcy-remote manner, and we take fiduciary care of those assets. We are, by every operational and legal measure, not a fractional reserve bank.

If, on the other hand, by "crypto bank" you mean an institution that holds digital assets in custody for clients, then the word "crypto" is doing all the work in your argument, and removing it reveals what is really being claimed. Nationally chartered banks have held custody of every conceivable type of asset for over a century, under the same fiduciary frameworks that 12 U.S.C. § 92a and 12 C.F.R. Part 9 already provide. Consider what national trust banks routinely safekeep already:

• Fine art and collectibles — paintings, sculpture, and rare objects held under dual control, with temperature-controlled storage, periodic physical inspection, and reappraisal. Federal banking examiners have published detailed guidance on the fiduciary’s responsibilities for these unique and special assets.

• Jewelry, gemstones, and family heirlooms — routinely held in vault custody by trust departments as part of estate and personal-property administration.

• Physical gold, silver, and bullion — explicitly authorized under state trust statutes and held by trust companies as far back as the nineteenth century. Modern trust companies continue to offer physical gold custody as a fiduciary service today.

• Antique automobiles, vintage watches, wine, and rare books — administered as personal property within trust and estate accounts, often with off-premises storage at specialty facilities and periodic fiduciary inspection.

• Farmland, timber, mineral rights, and oil and gas royalty interests — held and managed by national bank trust departments under fiduciary standards that include environmental insurance, physical inspection, and operating-agreement monitoring.

• Closely held business interests and even digital credentials — banks like Bank of Utah explicitly market fiduciary custody of "intangible or digital assets, such as social media accounts." That is, in effect, custody of a credential granting control of an account on someone else’s servers. The structural similarity to digital asset custody is exact.

National trust banks today hold nearly two trillion dollars in custody and safekeeping accounts. The question your letter never quite asks, but must answer, is this: on what principled legal basis should this one asset class (digital assets / crypto) be excluded from custodial activities that the law has welcomed for every other asset class for over a century? If the answer is that you do not approve of digital assets as an asset class, that is a policy view you are entitled to hold. But it is not an argument under the National Bank Act.

2. The trust company tradition is built around exactly what we do.

The institution called a "trust company" exists for the specific purpose of holding other people's property under a fiduciary standard of care. American trust law draws on an old common-law tradition in which a trustee holds legal title to property while the beneficial interest, and the duties that go with it, run to the beneficiary. State-chartered trust companies institutionalized this role in the nineteenth century. In 1913, Congress extended trust powers to national banks under what is now 12 U.S.C. § 92a. Neither legislators nor the OCC were inventing a new kind of bank; they were professionalizing fiduciary safekeeping for whatever assets clients needed someone trustworthy to hold — stock certificates, bearer bonds, gold and silver coin, deeds, jewelry, and so on. In 1963, Comptroller James Saxon wrote that "safekeeping of the securities in the customer's portfolio and other custodian services… will be performed by the bank's Trust Department in the usual case." That has been the consistent understanding of the law ever since.

Here is the point that matters: BitGo takes a fiduciary responsibility for our clients' assets. That is a higher standard of care than depository banks owe their customers. When you deposit dollars at a depository bank, you are an unsecured creditor of the bank. The bank owns your money, can lend it out, can take risks with it, and owes you a contractual claim to repayment. When you place assets with BitGo as a fiduciary, you still own them. We hold them for your benefit, segregated from our own balance sheet, with a legal duty of loyalty and care that runs directly to you. For crypto assets, which are bearer instruments where possession of a private key is functionally equivalent to ownership, this fiduciary standard is not just appropriate. It is the single most important duty we perform.

3. Depository banks have different rules because they take significantly different risks.

Your letter lists deposit insurance, safety-and-soundness rules, the Community Reinvestment Act, and Bank Holding Company Act consolidated supervision as obligations BitGo is somehow "evading." I want to address why these obligations exist for depository banks, and why they are inapplicable to a trust bank like ours.

Depository banks operate on a fundamentally different business model. They accept demand deposits (money customers can withdraw at any time) and use those deposits to make loans, many of them long-duration. A thirty-year mortgage funded by overnight deposits is, by design, a mismatch between liquid liabilities and illiquid assets. The depository bank takes credit risk that loans will not be repaid, interest-rate risk that the value of those loans will fall, and liquidity risk that depositors will want their money before the loans mature. Each of the regulatory obligations you listed exists to manage one of these risks: federal deposit insurance covers loss of money the bank has already lent out; safety-and-soundness capital rules ensure the bank can absorb credit, market, and interest-rate losses; the Community Reinvestment Act ensures that banks taking local deposits reinvest in their communities; the Bank Holding Company Act prevents commercial firms from using insured depositories as in-house piggy banks.

Each of these regulatory obligations is the price of a specific privilege: the privilege of taking customer deposits and putting them at risk. BitGo Bank & Trust does not take that privilege, and so it cannot owe that price. We hold client assets in reserve, segregated and bankruptcy-remote. We do not lend them. We do not take maturity transformation risk because there is no maturity transformation. The asset that arrives at our door is the same asset that leaves it.

To put it in plainer terms: asking a national trust bank to carry federal deposit insurance is like asking a person who only takes the bus to buy auto insurance. Auto insurance exists to cover the risks of driving. If you do not drive, you do not need it, and more fundamentally you are ineligible for it, because no actuary can price a risk the policyholder has structurally foreclosed. The FDIC insures against loss of customer deposits at institutions that put those deposits at risk. A trust company holding segregated, bankruptcy-remote client assets has no deposit base to insure, no fractional reserve to backstop, and no balance-sheet risk to underwrite. Forcing it into the deposit insurance system would not make consumers safer. It would charge a premium against a risk that does not exist.

The Bank Holding Company Act deserves a particular note, because your letter raises it specifically. The BHCA exists to prevent commercial firms from owning insured depositories and using customer deposits to subsidize, prop up, or lend to affiliated businesses. This is a classic concern of a bank-holding parent self-dealing with the bank’s deposit base. That concern is real, and it is exactly why the Act was passed. But it is a concern that only arises where there is a deposit base to misuse. A reserve bank holding client assets in segregated, bankruptcy-remote fiduciary accounts cannot lend those assets to its parent, to its affiliates, or to anyone else. The fiduciary duty under 12 C.F.R. Part 9 is the structural protection against precisely the conduct the BHCA was designed to prevent. Applying BHCA consolidated supervision to a reserve bank’s parent is not a strengthening of consumer protection; it is the application of a remedy to a disease the patient does not have.

The reason depository regulation exists in the form it does is the long history of depository bank failures: the panics of 1873, 1893, and 1907; the bank runs of the 1930s; the savings and loan crisis of the 1980s; the 2008 financial crisis; and the regional bank failures of 2023. In each case, depositors lost confidence in banks that had taken risks with their money, and policymakers responded with safeguards calibrated to those risks. The trust bank model exists precisely because not every institution should take those risks, and not every client should be exposed to them.

4. We hold reserves in full, and we prove it more often than any bank in the country.

Your letter expresses concern that companies receiving these charters may be engaged in stablecoin activities that resemble deposit-taking. I want to speak directly to that. When BitGo holds reserves backing a stablecoin, those reserves are present in full. They are not lent. They are not invested in maturity-transformed assets. They sit segregated, attributable to the obligations they back.

More importantly, we prove this publicly. For stablecoin assets, BitGo conducts auditor-backed reserve attestations twice every month, in addition to its regular cadence of quarterly and annual audits. There is not a depository bank in the country that audits or attests its balance sheet at that speed. Most banks file quarterly Call Reports. We attest twice a month, by an independent auditor, because we have the assets and we want our clients, regulators, and the public to be able to verify it. That is a higher transparency standard than the depository banking system will ever be able to achieve.

5. We have spent a decade asking for more oversight, not less.

Your letter frames the OCC charter as an attempt to escape regulation. The record is the opposite. BitGo has spent the last ten years deliberately seeking out the most rigorous regulatory regimes in every major jurisdiction we serve. We hold a South Dakota state trust charter dating to 2018, a separately chartered and supervised entity under the New York Department of Financial Services, and licenses from FINMA in Switzerland, BaFin in Germany, the Virtual Assets Regulatory Authority in Dubai, and the Monetary Authority of Singapore.

These regimes vary in their particulars, but they overlap substantially on the things that matter most: capital adequacy, segregation of client assets, anti-money-laundering and know-your-customer obligations, cybersecurity standards, custody controls, audit and reporting requirements, and fitness and propriety of management. We did not seek any of these licenses because we had to. For most of our history, no one was forcing us to. We sought them because our clients are pensions, asset managers, sovereign wealth funds, and ETF issuers who require regulated custodians, and because we believe the digital asset industry needs the same supervisory infrastructure that has made traditional securities custody one of the safest corners of finance.

BitGo did not organize for the purposes of the GENIUS Act. We applied for the OCC charter as the natural federal capstone on a decade of voluntarily building toward more oversight, not less. You are correct that the GENIUS Act did not amend Sections 27(a) or 92a, and BitGo's charter does not depend on it. Custody was a permissible fiduciary activity before GENIUS, and it remains one after.

6. Fiduciary custody is the cure for what your letter is worried about.

Here is the central irony I would like to leave you with. Almost every crypto failure that caused real consumer harm — FTX, Celsius, Voyager, BlockFi, Genesis — shares a single defining feature: the absence of fiduciary custody. In each case, an institution accepted customer assets, commingled them with its own balance sheet, lent them out, traded against them, or pledged them as collateral for its own borrowing. Customers believed they had property. They actually had unsecured claims against an unregulated counterparty. When the counterparty failed, the property was gone.

A national trust charter is the natural solution to exactly this problem. Under 12 C.F.R. Part 9, fiduciary assets are not the bank's assets. Even in the event of the bank's failure, client property remains client property and is not subject to the claims of the bank's creditors. The FDIC's own published guidance is explicit on this point. A federally chartered trust bank owes a duty of loyalty and care that runs directly to each client. FTX did not. Celsius did not. BitGo does. National trust banks are examined by federal bank examiners against detailed fiduciary standards covering segregation, controls, audit, capital, and risk management. The institutions that failed and harmed consumers were operating outside this framework precisely because they were not chartered.

Your letter argues that approving these charters poses risks to consumers. I respectfully submit the opposite: the consumer harm of the last cycle came from chartered fiduciary oversight being absent, not present. Bringing institutional digital asset custodians inside the perimeter of federal supervision is not a threat to consumers. It is the most effective protection consumers have ever been offered in this asset class. You and I should be on the same side of this question.

7. While we are talking about consumer protection.

Your letter treats depository banks as the gold standard of consumer protection and trust banks as a threat to it. I strongly push back on that framing. The opposite is true: a properly run trust bank is clearly better for consumers than a fractional reserve depository, and the numbers make it obvious.

The risk-free rate in the United States is currently approximately four percent. That is what the U.S. Treasury pays an investor to hold a Treasury bill for one year. It is, by definition, the return available to anyone with capital and no risk appetite. The FDIC's national average savings account interest rate, as of this month, is approximately 0.38 percent. At the largest depository banks in the country — the institutions where most American families actually keep their savings — the rate is often 0.01 to 0.05 percent. For a family with ten thousand dollars in a typical big-bank savings account, that is one to five dollars of interest per year, against a risk-free benchmark that would yield four hundred dollars. The gap between what depository banks earn on customer money and what they return to customers is, in aggregate, hundreds of billions of dollars per year. Those banks take risk with depositor money. The depositor receives almost none of the reward.

I do not raise this to attack the depository banking system. I raise it because your letter frames trust banks as something consumers need to be protected from, and depository banks as the standard. The honest picture is the opposite. We would like to hold client assets in 100 percent reserve, give clients 24x7 access to those assets, and provide a yield near the risk-free rate on those assets — all without taking the risks that today's depository banks take. A fiduciary custodian that holds client assets one for one, examined under 12 C.F.R. Part 9, offers a materially superior consumer proposition to any depository bank. I know you have long been an advocate for consumer protection. I would love to help you with this.

8. A note on terminology, and a closing thought.

Much of the confusion in this debate, I believe, comes from the imprecision of a single word: bank. We use it to describe institutions that are doing structurally opposite things, and then we are surprised when the same legal framework does not fit all of them. With respect, I would like to propose that we get more careful with our terms.

"Bank" is too generic to be useful. It is a category, not a description. A child's piggy bank, JPMorgan Chase, the Federal Reserve, and BitGo are all "banks" in some sense of the word. The category does no analytical work. When your letter argues that BitGo is "effectively a crypto bank," the rhetorical force of that phrase depends on the listener filling in a specific meaning the word itself does not supply.

"Depository Bank," "Insured Bank," and "Full-service Bank" (you used both of these in your letter) both obscure what these institutions are actually doing, and the risk that flows from it. "Depository" describes what the bank accepts. "Full-service" describes the menu of products it offers. Neither term names the core mechanic: the bank borrows from depositors in order to lend, at risk, to others. That activity (a.k.a fractional reserve banking) is the activity that defines them, generates their profits, and creates the risks that justify their regulation. They take in deposits, hold only a fraction of those deposits in reserve, and lend or invest the rest. That practice is the source of credit creation in the modern economy, and it is genuinely important. It is also the source of every systemic risk the FDIC, the Federal Reserve, the Community Reinvestment Act, and the Bank Holding Company Act exist to manage. If we called these institutions fractional reserve banks, we would be describing them accurately, and the framework that governs them would make immediate sense.

“Trust Bank” or “Reserve Bank” is a bank that holds client assets in segregated, bankruptcy-remote custody, one for one, with no lending and no maturity transformation. These banks are reserve banks in the literal sense: they hold the reserve. Calling such an institution anything other than a "reserve bank" obscures the most important fact about it: that it is, by structural design, safer than a fractional reserve bank. A taxonomy that recognized this distinction would treat the trust bank not as a lesser cousin of the depository (exempt from the "real" obligations) but as a different kind of institution serving a different purpose, regulated under a framework calibrated to its actual risks.

Which brings us back to "crypto bank." I would genuinely welcome your definition. If a "crypto bank" is a fractional reserve institution that takes customer crypto deposits and lends them out, then it should be regulated as a fractional reserve bank, and we should be on the same side of every policy question that follows. If a "crypto bank" is simply a reserve bank that holds digital assets in fiduciary custody, then the word is doing rhetorical work the underlying facts do not support. The asset class does not change the structure. A reserve bank that holds gold is a reserve bank. A reserve bank that holds stock certificates is a reserve bank. A reserve bank that holds bitcoin is a reserve bank. The thing that determines what kind of institution you are is what you do with the assets, not what the assets happen to be.

I suspect we would make much more progress on the underlying questions if our terminology distinguished between these structurally different institutions. So let me propose a simple taxonomy:

Bank — a general category covering any institution that holds, transmits, or manages money or financial assets on behalf of others. Useful as an umbrella term; not useful as a description of what any specific institution actually does.

Fractional Reserve Bank — the accurate term for what is currently called a "depository bank," "full-service bank," "traditional bank," or "insured bank." An institution that takes on-demand deposits and lends or invests those deposits at risk, holding only a fraction of them in reserve. This is the source of credit creation in the modern economy, and it is also the source of the systemic risks that justify federal deposit insurance, capital rules, the Community Reinvestment Act, and Bank Holding Company Act supervision.

Reserve Bank — the accurate term for what is currently called a "trust bank," "custody bank," "limited purpose trust company," or "fiduciary bank." An institution that holds client assets off-balance-sheet, segregated from its own funds, bankruptcy-remote, under a fiduciary duty of loyalty and care. It does not lend client assets. It does not take maturity transformation risk. It does not require deposit insurance because it has no deposit base at risk to insure. This is what BitGo Bank & Trust is.

FRIC (Fractional Reserve Insurance Corporation) — the accurate name for the institution currently called the FDIC (Federal Deposit Insurance Corporation). The word "Federal" in the current name is clearly misleading: it implies that the federal government funds the deposit insurance system when it does not. Rather, FDIC is funded entirely by insurance premiums paid by its member banks. But more importantly, it is insurance against failure for a very specific type of risk: depository banking or fractional reserve banking. Historically, these banks have failed so frequently that we created FDIC. It’s time to rename it the FRIC so that consumers more accurately know what it actually is.

Four terms. Each describes what the institution actually does. Each makes the appropriate regulatory framework obvious from the name itself. The current vocabulary lets a single word (“bank”) paper over distinctions that matter enormously for consumer protection, financial stability, and the proper scope of federal supervision. And ironically, the current terms allow an "insured bank" to appear safer than an "uninsured trust bank", when actually the opposite is true: Reserve Banks (trust banks) are structurally less risky than Fractional Reserve Banks (insured banks).

9. A direct invitation.

I will close with the same offer I would make to any senator who took the time to write this carefully about something my company does. If you believe BitGo is falling short of the standards the OCC has set, or the standards you believe the OCC should set, please come talk to us. The employees at BitGo dedicate their careers to this work. We are experts in how the banking system functions today, and in how it can be improved. We are happy to spend time with you and your staff and to answer any questions you have.

What we cannot respond to is a framing that treats the act of seeking regulation as evidence of evading it, or that treats a century-old, well-understood legal category — the national trust charter — as illegitimate because of the asset class it is now being asked to hold. Holding other people's valuable property, segregated, under a duty of loyalty, is what trust companies do. It is what BitGo does.

I look forward to your reply, and to the substantive conversation I believe both of us actually want to have.

Sincerely,

Mike Belshe
Chief Executive Officer
@BitGo, Inc.