Rain seeks trust bank, amid crypto license lawsuit in U.S.

Rain applies to establish a National Trust Bank of the United States, which plans to custody digital assets and issue stablecoins.

Rain has submitted an application to the Office of the Comptroller of the Currency (OCC) to establish a National Trust Bank of the United States called "Rain National Trust Bank." If approved, the institution will be qualified to custody digital assets, manage compliant stablecoin reserves, and issue dollar-backed stablecoins.

According to Rain's October 5 announcement, the proposed Rain National Trust Bank will be headquartered in New York and operate as an independently capitalized subsidiary under the supervision of the OCC. Rain itself will continue to exist as a stablecoin payment platform and will not transform into a banking entity.

Core Business and Functions

According to the company, if approved, Rain National Trust Bank will mainly provide the following three core businesses to institutional customers:

1. Fidelity custody of digital assets and U.S. dollars: provides regulated fiduciary custody services to ensure strict isolation of customer assets from the company's own assets.
2. Stability coin reserve management: Reserves are managed for approved stablecoin issuers under the framework of the federal GENIUS Act.
3. Issuance of dollar-backed stablecoins: serves as the issuer of record and is responsible for the issuance and redemption of dollar-backed stablecoins.

Significant differences from traditional banks

Although the name includes "bank", Rain National Trust Bank does not operate like a traditional commercial bank. The company made it clear that the agency will not accept public deposits, provide checking or savings accounts, conduct consumer account business, and issue commercial loans. As an uninsured national trust bank, it does not hold deposit insurance from the Federal Deposit Insurance Corporation (FDIC).

Rain emphasized that assets deposited in escrow accounts will be clearly identified as customer assets, not bank liabilities. In addition, the reserves supporting any stablecoins issued by the institution must not be pledged, borrowed or reused.

Management Appointment

Rain has nominated Brandon Soto as the proposed president and CEO, a move that is subject to OCC review and approval. Soto previously served as chief financial officer of Square Financial Services (Block's Chartered Industrial Bank of Utah) and later served as CFO at Coastal Financial Corporation.

Regulatory Disputes and Legal Background

Rain's application came as community banks challenged the OCC's legal framework for approving the National Trust Bank license. Just three days ago, the Independent Community Bankers Association of America (ICBA) filed a lawsuit in the U.S. District Court for the District of Colombia, questioning the legal basis used by the OCC to issue the National Trust Bank license.

In the lawsuit filed by the ICBA, the plaintiffs allege that the OCC "far exceeded" its legal authority by allowing National Trust Bank to engage in non-fiduciary activities under a limited purpose licence. ICBA asked the court to rule that the March 2026 OCC Rules and Interpretation Letter 1176 were illegal and revoke the conditional license approval previously granted to Protego Holdings.

The OCC holds a different view on this. The regulator said the rules it issued in March only clarified the long-standing authorization to allow National Trust Bank to engage in non-faithful activities while conducting faithful business, and did not expand or shrink its license approval authority. The rule came into effect on April 1.

Follow-up process

Rain's application currently needs to go through the OCC review and public comment consultation period. Rain hired Paul Hastings Law Firm to assist in preparing the application materials. While existing card, wallet and money transfer programs will continue to operate, Rain National Trust Bank will not be officially operational until all necessary regulatory approvals are obtained.

At the same time, other cryptography-related companies are also promoting similar applications. For example, stablecoin issuer Circle received final approval from the OCC in July to form First National Digital Currency Bank;Agora and Zerohash are also in different stages of approval.