Paxos Seeks U.S. Trust Bank License to Boost Stablecoin Game

Tue Aug 12 2025
Paxos is reportedly reapplying for a U.S. trust bank license, aiming to gain a regulatory edge in stablecoin issuance and blockchain finance.

🏦 Paxos Eyes U.S. Trust Bank License — Stablecoin Game About to Change?

Paxos might be leveling up from crypto infrastructure heavyweight to fully licensed U.S. trust bank — a move that could shake up stablecoin issuance and give Wall Street a Web3 makeover.


📌 Quick Take

  • Applicant: Paxos
  • Target License: U.S. Trust Bank Charter
  • Past Attempt: OCC conditional approval in 2021 → expired in 2023
  • Flagship Stablecoin: Pax Dollar (USDP) — 66.94M market cap
  • USDP Price: 1.00 (stable)
  • CEO: Charles “Chad” Cascarilla

🔄 Second Chance at a Banking Crown

Paxos has been here before. Back in 2021, the Office of the Comptroller of the Currency (OCC) gave it a green light — but only conditionally. By 2023, the clock ran out.

Now, sources say Paxos is back in the ring, applying again for a full trust bank license. If approved, it could open the door to:

  • Direct stablecoin issuance under a banking framework
  • Expanded custody & settlement services
  • Tighter regulatory trust from institutional clients

💵 Why This Matters for Stablecoins

USDP, Paxos’s dollar-pegged stablecoin, sits at a modest 66.94M market cap, but the firm’s real power is in its infrastructure muscle — powering other big-name stablecoins and settlement rails.

A trust bank license could:

  • Give Paxos the legal edge over offshore rivals
  • Allow FDIC-insured on/off ramps
  • Bring stablecoins deeper into U.S. mainstream finance

📈 Market Moves & Regulatory Timing

The timing isn’t random. Stablecoin regulation in the U.S. is heating up, with lawmakers eyeing bank-level oversight for issuers. Securing a trust bank license now could place Paxos ahead of any sudden legislative pivots.

Recent USDP trading volume spikes suggest traders are already positioning for something bigger.


🌐 Bigger Picture: Wall Street Meets Web3

If successful, Paxos could become a bridge institution — speaking both the language of DeFi and the compliance dialect of Washington, D.C.

This would make it a direct competitor to Circle (USDC) in the race for the “most bankable” stablecoin brand.


TL;DR

Paxos is reportedly reapplying for a U.S. trust bank license — a move that could reshape stablecoin issuance and give it a massive compliance edge in the U.S. market. With regulation looming, this could be Paxos’s most strategic power play yet.

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