OCC Gives Crypto Bank OpenReserve Conditional Approval
OpenReserve has cleared a major regulatory hurdle in the United States, but the significance of the decision goes beyond another crypto company entering banking.
Key Takeaways
- OCC conditionally approves OpenReserve bank.
- Blockchain sits at the core.
- Deposits and lending are planned.
- Stablecoins are part of plans.
- OpenReserve cannot open yet.
OpenReserve is building a crypto bank differently
On September 2, the Office of the Comptroller of the Currency gave preliminary conditional approval for OpenReserve Bank, National Association, a proposed full-service national bank in Salt Lake City, Utah.
The application covers a broad banking business. OpenReserve plans to offer deposits, lending, payments, treasury services and digital-asset products, while using blockchain-based systems as part of the bank’s underlying infrastructure.
That puts the company in a different position from firms seeking a charter mainly to provide crypto custody.
As the recent crypto bank-charter wave shows, custody has become one of the main routes for digital-asset companies moving into regulated finance. OpenReserve is pursuing a broader model that brings banking services and blockchain settlement into the same institution.
For businesses, the potential benefit would be fewer separate systems for moving cash, handling digital assets and accessing financing. Whether that advantage materializes will depend on the bank’s execution once it is allowed to operate.
The OCC approval is only the beginning
The regulator’s decision comes with an important qualification: the approval is preliminary and conditional.
OpenReserve can continue organizing the proposed bank, but it must complete a series of requirements before it can begin the business of banking. The OCC says the institution is expected to obtain federal deposit insurance from the FDIC and apply for stock in a Federal Reserve Bank.
The bank must also complete its preopening work and undergo a preopening examination. Those requirements are set out in the OCC’s Corporate Decision 1389.
Capital is another major requirement. OpenReserve must raise at least $210 million in initial paid-in capital, after organizational and preopening expenses. The OCC also requires a Tier 1 leverage ratio of at least 12% during the first three years of operation.
Technology and compliance controls are part of the approval as well. OpenReserve must establish its required risk and compliance programs, document its final information-systems architecture and complete independent security testing of its electronic banking platform. The company therefore has a substantial amount of work to complete before customers can use the bank.
What OpenReserve plans to put inside the bank
OpenReserve’s proposed business extends well beyond digital-asset custody. The public bank application describes deposit and lending products, including tokenized versions, alongside payments, treasury services and foreign correspondent banking.
The digital-asset offering would include nonfiduciary custody, wallet hosting and cryptocurrency custody. Customers could also use digital assets such as stablecoins for certain remittance transactions.
A separate subsidiary would handle the stablecoin operation. According to the OCC decision, OpenReserve plans to establish a wholly owned subsidiary for issuing, holding, converting and processing payments involving U.S. dollar-denominated reserve-backed stablecoins. The OCC noted that the subsidiary’s application had not yet been filed when it issued the charter decision.
The combination is what makes the proposal unusual. OpenReserve would have a banking balance sheet alongside digital-asset custody and blockchain-based settlement rather than operating those activities as separate businesses.
Where blockchain could make a difference
The case for the model ultimately comes down to what customers can do with it. OpenReserve describes its concept as a “continuous bank,” with financial services designed to operate around the clock. Its public materials highlight tokenized deposits, digital vaults and asset-backed financing as part of that approach. OpenReserve’s description of the model provides more detail on how the company sees those services working together.
For a corporate treasury team, the attraction would be practical. A business may keep cash at one bank, digital assets with another provider and financing arrangements somewhere else. Moving between those systems can create settlement delays and additional reconciliation work.
A shared blockchain ledger could reduce some of that friction by allowing certain assets and payment instructions to settle without waiting for several separate systems to update. That could be useful when companies operate across time zones or need to move collateral quickly. The technology still needs to produce a clear benefit, though. A faster settlement rail means little to a customer if the wider banking experience remains expensive, difficult or unreliable.
Stablecoins could support the same system
The proposed stablecoin subsidiary fits into this wider banking strategy. OpenReserve wants to issue dollar-denominated stablecoins while operating a bank that also provides deposits, lending, payments and treasury services. The OCC has already addressed the use of distributed-ledger technology and stablecoins in permissible payment activities by national banks, subject to applicable requirements.
The important issue is how those functions would work together. A stablecoin could handle a payment or transfer while a bank account, custody service or credit facility provides the surrounding financial relationship. In that setup, the token becomes one component of the banking service rather than the entire product.
A blockchain bank still faces ordinary banking risks
The use of blockchain does not remove the basic responsibilities that come with running a bank. OpenReserve will need controls covering credit risk, cybersecurity, customer information, anti-money-laundering rules and sanctions compliance. Several of those areas are specifically addressed in the OCC’s conditions.
The regulator is also scrutinizing the technology itself. OpenReserve must provide a detailed description of its final information-systems architecture and a risk-management plan. Before opening, the bank must complete independent testing of its electronic banking platform, including controls intended to prevent unauthorized access and other security threats.
The blockchain ledger is only one part of the system. Customers will still interact with applications and APIs, while the bank will need identity controls, custody procedures and internal systems for handling errors or disruptions. Those systems will have to work reliably if OpenReserve is to deliver the faster settlement it is promising.
Customer demand will determine whether the model works
A bank charter establishes the regulatory framework. It does not tell us whether businesses will use the service. OpenReserve will need to show that its approach improves something customers already care about, such as settlement speed, treasury management, collateral movement or access to financing. Lending could be one of the clearest tests.
The OCC confirms that lending is part of the proposed bank’s core business. A company that can move collateral more quickly and use it within a regulated credit relationship could potentially manage its liquidity more efficiently. That would be a stronger demonstration of blockchain’s value than simply showing that a payment can settle onchain.
What OpenReserve has to complete
The next phase is about turning the approved plan into an operating institution.
- Final OCC approval: The bank must satisfy its preopening conditions.
- Deposit insurance: OpenReserve still needs the required FDIC approval.
- Capital: The bank must meet the OCC’s $210 million requirement.
- Technology: Its systems must pass regulatory and security reviews.
- Customers: The business model must prove its value in practice.
The approval also comes with a timetable. Under the OCC’s decision, it expires if OpenReserve does not raise the required capital within 12 months or open the bank within 18 months of the preliminary conditional approval date, subject to the extension provisions in the decision.
For now, the focus is on completing the regulatory and operational work required to get the institution ready.
OpenReserve still has to prove the idea
The OCC has given OpenReserve a path to become a national bank, but the company still has to complete the regulatory process and build the systems described in its application.
The bigger test comes after that: whether businesses actually use the bank’s combination of traditional financial services and blockchain-based settlement because it solves a problem better than existing alternatives.
The article is provided for informational purposes only and does not constitute investment advice.
Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work at Coindoo has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.
