Coinbase, Circle, and BitGo consider applying for U.S. banking licenses, signaling a shift toward traditional finance - IcoHolder.

As the U.S. crypto industry navigates a changing regulatory environment, major players like Coinbase are eyeing a bold move into traditional finance. On April 22, a spokesperson for Coinbase confirmed to crypto.news that the company is actively considering applying for a U.S. banking license, though no formal decision has yet been made.

The potential shift aligns with earlier remarks by Coinbase CEO Brian Armstrong, who noted that, based on the volume of consumer funds under its management, the crypto exchange would rank as the 21st largest bank in the United States. Now, with regulatory momentum shifting under a more crypto-friendly administration led by President Donald Trump, the prospect of Coinbase entering the banking sector is gaining traction.

Coinbase is not alone. USDC issuer Circle and crypto custody firm BitGo are also reportedly exploring the possibility of obtaining full banking licenses, according to a report by The Wall Street Journal on April 21. Securing such licenses would allow these firms to expand their offerings to include traditional banking services such as lending and accepting deposits, while also gaining access to Federal Reserve protections and deposit insurance—key elements that could enhance customer trust and security.

The path to becoming a bank is not without challenges. Anchorage Digital remains the only crypto-native firm to have secured a banking license to date. Its CEO, Nathan McCauley, disclosed that the firm spent tens of millions of dollars to meet stringent regulatory requirements.

Despite the high compliance costs, the move toward formal banking status appears increasingly attractive. Legislative efforts such as the GENESIS Act and the STABLE Act are currently under review in Congress, aiming to provide clearer regulatory frameworks for the crypto industry. These bills could pave the way for crypto firms that are willing to operate within a more traditional regulatory structure.

At the same time, traditional financial institutions are also making their move. In February, Bank of America CEO Brian Moynihan announced the bank was exploring a stablecoin offering, after advocating in January for deeper integration of crypto payments.

With regulatory clarity on the horizon and mainstream banks warming to digital assets, the crypto sector’s pursuit of banking licenses marks a significant turning point—one that could redefine the boundaries between traditional and decentralized finance.