Rain seeks OCC license to control every step of stablecoin payments

Rain applied to the OCC for a National Trust Bank license, with the intention of controlling the entire chain of stablecoin payments.

Rain has submitted an application to the U.S. Office of the Comptroller of the Currency (OCC) to establish a National Trust Bank, which is expected to issue stablecoins in the future. Currently, Rain is a major member of Visa and Mastercard, connecting its stablecoin to these two major payment networks. If the application is approved, the issuance of stable coins, reserve management and card clearing will all be integrated within the same group.

However, Community Bank is filing a lawsuit against the OCC over the licensing license applied by Rain, challenging its regulatory powers.

Application details: Building a vertically integrated stablecoin ecosystem

Rain submitted an application to the U.S. Office of the Comptroller of the Currency on October 5 to establish a "Rain National Trust Bank." This is a New York-based subsidiary that is mainly responsible for issuing dollar-backed stablecoins, managing the underlying reserves, and serving as a trustee for the custody of client assets. Given that Rain is already a major member of Visa and Mastercard, once approved, almost the entire stablecoin card payment process, from token creation to card network settlement, will be under the control of a single enterprise group.

Current architecture vs. new architecture: Changes in capital flows

In the payment projects that Rain participates in, when the cardholder spends at the merchant, the funds behind the transaction have actually gone through multiple transfers. Currently, stablecoins are issued by external companies, and the issuer chooses banks to deposit supporting reserves, while third-party custodians usually hold these tokens. Rain only steps in at the last step, responsible for converting the balance and completing the settlement through Visa or Mastercard.

This path will change fundamentally with the acquisition of new licenses:

• 1. Token issuance: Currently the responsibility of an external issuer; once licensed, Rain will be responsible.
• 2. Reserve management: is currently the responsibility of the issuer's cooperative bank; after obtaining the license, Rain will be the responsibility of the company.
• 3. Client asset holding: is currently the responsibility of a third-party custodian; after obtaining the license, Rain will be responsible.
• 4. Wallets, cards and rewards: is now Rain's business scope.
• 5. Merchant collection: Settlement is completed through Visa and Mastercard networks.

Over the past two years, Rain has improved most of its customer-facing business aspects, including deposit channels, wallets, cards, withdrawal services covering more than 80 countries, and reward mechanisms (especially after the acquisition of Uptop in November 2025). However, the regulated layer at the bottom still relies on partners. Rain's own filings show that it currently relies on state licenses, third-party custodians and external stablecoin issuers to support the asset needs of its clients 'projects.

Financial impact: Including interest income

Rain's valuation reached US$1.95 billion in January 2026. Within one year, it has achieved a 30-fold increase in the number of active cards, a 38-fold increase in annualized transaction volume, and the platform has access to more than 100 organizations.

Rain CEO Farooq Malik said the move is mainly to meet the needs of institutional clients who want their assets to be held by trustees under federal supervision. In addition, there is an undisclosed financial motivation for Rain: stablecoin issuers typically earn interest income from the treasury bonds and cash reserves behind their tokens, and under the current model, this income goes to Rain's partner issuers. Becoming an official publisher will consolidate this revenue line and custody fees within the Rain Group.

To run the bank, Rain hired Brandon Soto, who most recently served as chief financial officer of Coastal Financial Corporation. Previously, he held the same position at Block's Square Financial Services, assisted in preparing its licensing application, and worked at Green Dot Bank.

Strategic comparison: Different paths between Circle and Rain

Circle received final OCC approval from Circle National Trust in July. The bank started with custody and plans to subsequently take over management of USDC reserves. Circle builds tokens first and then adds regulated custody services; while Rain builds a card payment network first and then extends back to the token issuance level. The ultimate goal of both is to achieve unity of issuance, reserve and custody within the entities they control.

Other competitor dynamics are as follows:

• Modern Treasury: applied on the same day as Rain, but explicitly stated that the entity will not issue stablecoins.
• Coinbase: received conditional approval in April, involving custody only and no issuance rights.
• Kraken parent Payward: filed in May, focusing primarily on the description of the escrow business.

Regulatory Dispute: Litigation of Community Banks

Three days before Rain requested issuance authority, on October 2, the Independent Community Bankers Association of America (ICBA) sued the OCC in federal court in Washington, challenging its power to grant limited purpose trust licenses to crypto and fintech companies. At the heart of the controversy is an OCC rule (effective April 1) that allows national banks that only engage in trust business to carry out non-trust activities related to their trust business. Traditional "safe custody" meets the definition of entrusted work, but "issuing payment tokens" is less obvious, making Rain's application a more severe test of the rule, different from previous applications that were mainly entrusted with custody.

Future Outlook: Long approvals, risks to partners

Rain called the project a multi-year initiative and that RNTB could not operate until it received OCC authorization. If ICBA wins the lawsuit, it may hinder the entire queue of pending applications. In addition, the OCC is still working on regulations on the GENIUS Act, covering reserves and allowed issuer requirements, which will define banks 'issuance operations.

If the license is finally approved, organizations on the Rain platform can obtain tokens, reserves, custody and card services from a single provider, and issuers and custodians currently serving these projects could be hit by losing business.

It is worth noting that the only link that Rain reserves for external processing is online settlement. However, this link is also changing. Visa said in April that its stablecoin settlement pilot program has reached an annualized operating rate of US$7 billion, a quarterly growth rate of 50%, and that the network now supports more than 160 stablecoin-related card projects.