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Paxos refutes bank charter rejection rumors

Jun 24, 2023

Brokerage and stablecoin issuer Paxos said it had not been denied a national bank charter from the Office of the Comptroller of the Currency (OCC).

On Feb. 7, rumors emerged that the OCC had denied Paxos its bank charter — arising from the preliminary approval that Paxos obtained from the OCC, which was set to expire if Paxos did not open its chartered bank within 18 months.

The OCC granted preliminary approval in April 2021, and it has now been 22 months since that date, making the opening four months overdue.

Paxos categorically denied all rumors in its Feb. 8 tweet. It said that the OCC has not rejected its application for the charter, nor has the regulator asked it to withdraw its application.

"Paxos continues to work constructively with the OCC."

If Paxos obtains the charter, it will operate as a federally-regulated digital asset bank alongside competitors Anchorage and Protego. It will be able to operate across the U.S. without obtaining licenses in individual states that would otherwise require one.

Separate rumors emerged on Feb. 9 suggesting that Paxos faces a probe from the New York Department of Financial Services (NYDFS).

Those rumors did not disclose the reasons for the supposed investigation and neither party has publicly confirmed any probe.

Paxos is responsible for the stablecoins Binance USD (BUSD) and the Pax Dollar (USDP). It also operates a crypto brokerage and powers PayPal's crypto trading capabilities.

Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.

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