Paxos Pursues a Charter with the National Trust to Gain Federal Supervision
Charles Cascarilla, CEO and co-founder of Paxos, a real-world assets tokenization company, has filed for a national trust bank charter with the U.S. Office of the Comptroller of the Currency (OCC). This move is rooted in Cascarilla's belief in the transformative power of blockchain as a force for financial freedom.
If approved, Paxos would operate under federal regulation, allowing it to manage customer assets and process payments under OCC supervision. However, it would not accept traditional deposits or issue loans. This would place Paxos within a multi-jurisdictional regulatory framework alongside European, Singaporean, and Abu Dhabi regulators, reinforcing its commitment to safety, transparency, and regulatory compliance.
The strategic significance of this move is heightened by the recent passage of the GENIUS Act, signed into law under President Trump. This legislation has created a more favorable regulatory environment for stablecoins and crypto firms seeking federal charters. Paxos’ pursuit of the national trust charter positions it to benefit from streamlined compliance, enhanced regulatory certainty, and increased credibility with institutional partners and mainstream financial service providers.
The charter would not only affirm Paxos’ role in issuing regulated stablecoins like PayPal’s PYUSD, but also advance stablecoin market growth by offering the highest level of federal oversight and trust. This status helps stablecoins become more viable as mainstream financial instruments for payments, treasury management, and other corporate uses.
Paxos has a diverse Stablecoin portfolio including PayPal USD (PYUSD), Pax Dollar (USDP), Pax Gold (PAXG), Binance USD (BUSD), and others. The company remains committed to maintaining full backing of issued stablecoins with secure reserves.
It is not clear from the provided information whether the GENIUS Act has had a direct impact on Paxos' decision to apply for a national charter. However, the ongoing implementation of the GENIUS Act has favored stablecoins development and adoption in the United States, with more traditional financial institutions venturing into the stablecoins market.
If successful, Paxos would end its NYDFS charter obtained in 2015 and operate under federal oversight. The application for a national trust bank charter aims to offer enterprise partners and consumers the safest, most trusted infrastructure available, but this has not been confirmed to be a current reality.
The stablecoins market is well-primed to grow exponentially in the coming years, fueled by the clear regulatory frameworks in the United States. The approval of Paxos' application could be a significant step for Paxos and the broader stablecoin industry toward integration with the traditional banking system and greater regulatory legitimacy.
- With the passage of the GENIUS Act, Paxos' pursuit of a national trust bank charter positions them to benefit from streamlined compliance and enhanced regulatory certainty, targeting increased credibility with institutional partners and mainstream financial service providers.
- Paxos' diverse Stablecoin portfolio, including PayPal USD, Pax Dollar, Pax Gold, Binance USD, and others, remains committed to maintaining full backing of issued stablecoins with secure reserves.
- The approval of Paxos' application for a national trust bank charter could be a significant step for Paxos and the broader stablecoin industry, potentially leading to integration with the traditional banking system and greater regulatory legitimacy, as the stablecoins market is well-primed to grow exponentially in the coming years.
