Block Seeks OCC Trust Charter to Centralize Bitcoin Custody and Stablecoin Settlement

Block is trying to rewrite its crypto operating model with a federal wrapper. On September 4, the company behind Square and Cash App submitted an application to the Office of the Comptroller of the Currency to form Builders Bank & Trust—an uninsured, non-depository national trust bank designed to custody Bitcoin and other digital assets, execute customer orders as riskless principal, and handle stablecoin settlement. No deposits. No lending. Pure infrastructure.

The strategic calculus: swap a patchwork for a platform. Block says it has spent roughly eight years running digital asset services under more than 50 state money transmitter and virtual currency licenses. In 2025 alone, it processed about $10.7 billion of Bitcoin transaction volume, and by the second quarter it was serving around two million monthly crypto users via Cash App. A national charter would give Block a single, consistent framework as those activities scale—reducing duplicative compliance, aligning supervision under one primary regulator, and positioning the entity as a cleaner counterparty for partners who want federal oversight.

Governance and footprint signal a purpose-built utility. Builders Bank would be headquartered in Sioux Falls, South Dakota, with no branches. All five proposed directors live outside the area, and Block has requested a waiver of the 100-mile residency requirement. Lee Woolley—Block’s digital asset strategy lead and a veteran of Northern Trust and BNY Mellon—would chair and serve as CEO. Jack Dorsey is listed only as Block’s co-founder; he is not an organizer, director, or senior executive of the proposed bank. The bank cannot open without the OCC’s approval, and the business plan and capitalization details were submitted confidentially.

This is not a bet on leverage or spread income. By design, an uninsured national trust bank doesn’t take deposits or extend credit, which narrows prudential burdens while sharpening the focus on custody, settlement, segregation, and controls. For crypto, that matters: qualified-custody–style capabilities, coherent risk management, and standardized attestations are increasingly table stakes for institutions and fintech partners. A trust charter can formalize those expectations under a federal umbrella, without importing the full complexity of a commercial bank.

The regulatory backdrop is active—and contested. The OCC conditionally approved five crypto trust charters last December (Circle, Ripple, BitGo, Fidelity Digital Assets, Paxos) and three more in February, including Crypto.com and Stripe subsidiary Bridge. Coinbase secured preliminary approval in April. Applications from Morgan Stanley, Payoneer, Zerohash, Kraken’s Payward, and the Trump-linked World Liberty Financial remain pending. Approval is not automatic: the OCC denied Wise National Trust in July. In April, the agency revised its chartering rule from “fiduciary activities” to “operations of a trust company and activities related thereto,” a nuance Block’s filing leans on. The OCC says this change did not expand or restrict its authority, though Senator Elizabeth Warren has argued the agency lacks authority to grant trust charters to firms that don’t perform traditional fiduciary work—an interpretation industry participants dispute.

One tension is deliberate. Stablecoin settlement is in scope, even though Dorsey has said he’d rather build on Bitcoin than embrace stablecoins. For a payments-heavy business serving merchants and consumers, the choice is pragmatic: stablecoins currently offer predictable settlement, cross-border utility, and developer mindshare that Bitcoin’s Lightning has struggled to match at retail scale. Integrating stablecoin rails alongside Bitcoin custody may improve finality, reduce card-dependent costs, and broaden partner reach—without forcing a philosophical pivot inside Block’s product ethos.

Leadership DNA hints at where Block wants to compete. With Woolley’s traditional custody background, Builders Bank looks aimed at institutional-grade controls rather than retail splash. That could make the entity a service spine for Cash App while also enabling white-label custody and settlement for third parties—competing with Anchorage, BitGo, Fidelity, and newer trust entrants. Concentrating crypto operations inside a federal trust could also streamline examinations across BSA/AML, cybersecurity, wallet architecture (HSMs, multi-sig, and segregation), and stablecoin chain support.

Near-term market context is stable but watchful. Bitcoin trades around $79,390, up 3.62% on the day, with a 24-hour high of $79,701, low of $77,666, and roughly $1.1 billion in volume. Prediction market odds from Myriad put a 68% chance of BTC holding $78,000–$80,000 today and a 60% chance it finishes the week below $80,000—numbers that reflect a market waiting on catalysts like regulatory clarity.

What to watch next: - OCC’s stance on non-depository trust charters after the recent rule tweak and the Wise denial - Whether Builders Bank is positioned as a qualified custodian for institutions - How Block integrates stablecoin settlement for Square merchants without diluting its Bitcoin-first angle - Timing and conditions the OCC could attach, given national preemption vs. state MTL regimes

If approved, Builders Bank would be less a new bank and more a normalized operating system for Block’s crypto stack—cleaner lines of authority, fewer jurisdictional seams, and a clearer signal to counterparties who want federal-grade custody and settlement.