Block Pursues Trust Bank Charter for Bitcoin and Stablecoin Custody

Builders Bank Designed for Regulated Crypto Safeguarding

Jack Dorsey’s financial technology company Block is applying for a federal trust bank charter in the United States to create a regulated entity focused on safeguarding digital assets. The proposed institution, named Builders Bank, would operate under federal supervision and specialize in custody services for Bitcoin and stablecoins. Block aims to launch the bank without offering traditional deposit accounts or lending products, concentrating solely on secure storage of cryptocurrencies. The move reflects Block’s strategy to deepen its involvement in the digital asset ecosystem while aligning with regulatory expectations. By pursuing a trust charter, Block seeks to provide institutional-grade safeguards for crypto holdings under a framework recognized by U. S. banking authorities.

Unlike conventional banks, Builders Bank would not take customer deposits or extend loans, instead focusing exclusively on the custody of Bitcoin and stablecoins. This structure allows Block to offer a service that meets the growing demand from investors and firms seeking secure, compliant storage for digital assets. The trust bank model is commonly used for entities that hold assets on behalf of others without engaging in traditional banking activities. Block’s initiative comes as regulatory scrutiny of crypto custodians increases, with federal agencies emphasizing the need for oversight in the sector. The company has not disclosed a timeline for when the charter application might be approved or when operations could begin.

How Will Builders Bank Differ From Existing Crypto Custody Services?

Builders Bank would distinguish itself by operating under a federal trust charter, potentially offering a higher level of regulatory recognition than many current crypto custody providers, which often function under state-level money transmitter licenses or limited-purpose trust arrangements. By avoiding deposit-taking and lending, the bank sidesteps certain regulatory complexities associated with traditional banking while still falling under federal oversight. This approach could appeal to clients who prioritize regulatory clarity and institutional safeguards when selecting a custodian for Bitcoin or stablecoin holdings. Block’s existing infrastructure in payments and blockchain development may support the bank’s operational framework, though specific technical details have not been shared.

What services will Builders Bank offer? Builders Bank will provide custody services for Bitcoin and stablecoins, meaning it will securely hold these digital assets on behalf of customers. It will not offer checking or savings accounts, nor will it issue loans or engage in traditional banking activities.

Frequently Asked Questions

Why is Block seeking a federal trust bank charter? Block aims to establish a federally regulated entity to enhance trust and compliance in its digital asset custody offerings. A federal charter would subject Builders Bank to uniform national standards, potentially increasing confidence among institutional and retail users.

When could Builders Bank begin operations? Block has not announced a timeline for when the trust bank charter application will be approved or when Builders Bank might start serving customers. The process depends on regulatory review and approval by the appropriate federal authorities.