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Zerohash joins wave of crypto firms pursuing US national trust bank charter

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Zerohash joins wave of crypto firms pursuing US national trust bank charter

Zerohash is looking to secure a United States national trust bank charter as it plans to operate a federally regulated trust bank.

Summary

  • Zerohash has applied for a United States national trust bank charter as it seeks to operate a federally regulated trust bank and expand its services under the GENIUS Act framework.
  • Applications for national trust bank charters have surged since the GENIUS Act was passed in July.

Securing a National Trust Bank charter from the Office of the Comptroller of the Currency will allow the company to “expand its service offerings under a federal framework, including those activities that fall under the GENIUS Act,” Zerohas said in its official announcement.

Zerohash is a blockchain infrastructure provider that allows financial institutions and fintech firms to integrate crypto services such as trading, custody, and stablecoin payments. The company has been operating since 2017, with some of its clients including big names like Morgan Stanley, Franklin Templeton, and Stripe.

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“Applying for a National Trust Bank Charter is a natural next step in offering robust global licensing coverage and continuing to expand our product offering,” the company’s Chief Legal and Compliance Officer, Stephen Gardner, said in a statement.

According to the OCC’s website, Zerohash filed for a national trust bank charter in February alongside two other applicants, Morgan Stanley and PAYO Digital Bank.

Securing this license allows companies to operate federally regulated trust banks and offer services such as custody and asset safekeeping to financial institutions.

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Under Donald Trump’s administration, several crypto firms have applied for this charter, including Trump family-backed World Liberty Financial, alongside other companies like Coinbase.

Since the passage of the GENIUS Act in July, this license has become one of the most sought-after regulatory approvals for crypto companies seeking to operate stablecoin and custody services under a federal framework.

As previously covered, the OCC has issued conditional licenses to multiple applicants, including Bridge, Crypto.com, Circle, Ripple, Fidelity Digital Assets, BitGo, and Paxos.

However, it has drawn criticism from some lawmakers, most notably Elizabeth Warren, who has recently pushed back against World Liberty’s pending bank charter application and raised questions about disclosure of foreign investors tied to the venture.

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Crypto World

Morgan Stanley Sets Bitcoin ETF Fee at Ultra-Low 0.14%

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Morgan Stanley Sets Bitcoin ETF Fee at Ultra-Low 0.14%

Investment bank Morgan Stanley is seeking to launch its spot Bitcoin exchange-traded fund at a 0.14% fee, which would make it the cheapest in the US market and potentially force rivals to cut fees to stay competitive.

The 0.14% fee, proposed in Morgan Stanley’s latest S-1 registration statement on Friday, would be one basis point below the Grayscale Bitcoin Mini Trust ETF (BTC), currently the cheapest in the US market, and 11 basis points below the BlackRock-issued iShares Bitcoin Trust ETF (IBIT).

“Big move here. They are not messing around,” Bloomberg ETF analyst James Seyffart said, predicting that the Morgan Stanley Bitcoin Trust (MSBT) is “likely to launch in early April.”

Source: James Seyffart

Fellow Bloomberg ETF analyst Eric Balchunas said the low fee means that none of Morgan Stanley’s roughly 16,000 financial advisors — which manage $6.2 trillion in client assets — would feel conflicted in recommending the product to its clients.

Given that spot Bitcoin ETFs track the price movements of Bitcoin (BTC), Morgan Stanley’s ultra-low fee could spark a fresh fee war in the $83 billion market, putting immediate pressure on rivals to cut costs or risk losing assets.

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Regulatory approval would make Morgan Stanley the first bank to issue a spot Bitcoin ETF, expanding access to Bitcoin exposure for millions of its high-net-worth clients.

“They are the ultimate gatekeepers of rich boomer money,” Balchunas added.

Morgan Stanley previously selected Coinbase and Bank of New York Mellon as the proposed custodians for its Bitcoin ETF.

Morgan Stanley seeking suite of crypto ETFs, banking charter

Morgan Stanley, previously one of the more crypto-hesitant Wall Street firms, filed for the spot Bitcoin ETF in the first week of January, along with a Solana (SOL) ETF.

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Related: Bitcoin traders see 53% odds of sub-$66K BTC by April 24 

It then filed papers for a staked Ether (ETH) ETF later that week, and by the end of the month, the bank appointed one of Morgan Stanley’s longest-standing executives, Amy Oldenburg, to lead its digital asset team.

Source: James Seyffart

Morgan Stanley also applied for a national trust banking charter on Feb. 18, seeking to custody certain digital assets and execute purchases, sales and swaps for clients in addition to staking services.

In October, before the investment bank adopted its institutional crypto strategy, it recommended a 2% to 4% allocation to crypto portfolios for investors. It also allowed its financial advisors to recommend crypto funds to clients with individual retirement accounts (IRAs) and 401(k)s.

Magazine: Bitcoin may face hard fork over any attempt to freeze Satoshi’s coins

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