The Trust Charter Gold Rush
By: Paul Schaus
August 18, 2026
Banking's oldest business has just become its hottest charter. In a single day last December, the OCC conditionally approved five national trust banks for Circle, Ripple, Paxos, BitGo, and Fidelity Digital Assets — and the pipeline has since grown to twenty-one institutions in under nine months. Meanwhile, inside traditional banks, trust divisions sit on decades-old core systems, staring at the largest wealth transfer in history with technology built for a different century. Two worlds, one charter. The gap between them is where the next decade of fiduciary banking will be decided.
In my years in the consulting business, occasionally I would be asked about trust core technology. This year I have been asked a dozen times — and not just by a trust officer. The question is coming from CEOs and strategy heads, and they all trace back to the same December morning.
On December 12, 2025, the OCC did something no one in trust banking had ever seen: it conditionally approved five national trust bank charters in a single announcement — de novo charters for Circle's First National Digital Currency Bank and Ripple National Trust Bank, and conversions for Paxos, BitGo, and Fidelity Digital Assets. Circle completed the process in July, becoming the first stablecoin issuer with a national trust bank, and the OCC's August chartering decisions signal the door remains open. Comptroller Gould put the philosophy in one sentence: "There is simply no justification for considering digital assets differently" from the custodial services national trust banks have performed for decades. Read that again. The oldest license in American banking — the trust charter, the one your grandfather's bank used to hold farmland and railroad bonds — has become the newest front door into the banking system.
The logic is clean once you see it. A national trust bank takes no deposits, makes no loans, and needs no deposit insurance — which means no FDIC application, the historical graveyard of fintech charter ambitions. What it does get is custody and fiduciary powers under a single federal regulator, replacing fifty state money-transmitter licenses with one supervisory relationship. And under the GENIUS Act, a federal trust charter is a natural home for a stablecoin issuer — holding reserves safely is structurally the business trust banks were invented for. The incumbents see the stakes: the Bank Policy Institute formally objected to the five approvals — and the door is selective: Coinbase and Stripe's Bridge were passed over in the December round, though both won conditional approval within months. Count the pipeline today and the scale comes into focus: by American Banker's running tracker, two national trust banks are operational, ten hold conditional approvals, and nine more applications are in the approval stage — twenty-one institutions in under nine months. And read the recent names carefully, because the second wave is not crypto. Morgan Stanley and Nomura's Laser Digital won conditional approvals this spring; Payoneer and Kraken have filed; so has an AI-native startup. In three quarters, the trust charter has gone from crypto's workaround to a mainstream market-entry vehicle. It is now the fastest lane into the banking system, and everyone knows it.
Before any trust executive concludes this is someone else's story, get the charter question straight. A national trust bank is not a new kind of license — it is a special-purpose national bank limited to the activities of a trust company. A traditional bank with trust powers holds the same fiduciary and custody authority, plus everything else a bank does. The newcomers took a narrow slice of the license. And the authority runs both ways: the OCC's Interpretive Letters 1183 and 1184 removed the old supervisory-nonobjection requirement and confirmed that any national bank may provide digital asset custody and execution, including through sub-custodians. What a traditional bank cannot simply do is Circle's business — issuing stablecoins and managing reserves is the GENIUS Act's issuer framework, a scale game with its own approval path. The reverse holds too: the new trust banks are bound to their stated business plans — custody and reserves — not estate settlement, not personal trusteeship, not the family fiduciary work that fills a traditional trust book.
The question I am asked most often is: should a traditional trust operation just stay traditional? From a business model perspective, the answer is mostly yes — a community trust department has no business chasing reserve custody at scale. But do not confuse the business with the capability. Their business is not your business; their asset class is about to be in your accounts. The estates now moving through the great wealth transfer increasingly contain digital assets, and a trustee who cannot hold, value, or administer them cannot settle those estates. Staying traditional in strategy is a defensible choice. Staying traditional in capability means turning away fiduciary work you are chartered — and now explicitly permitted — to do.
Now turn to the institutions that have been doing this work, because they span a wider range than the headlines suggest. At one end sits the community institution whose fiduciary history predates most of the industry. Washington Trust in Westerly, Rhode Island has been open since 1800 — the oldest community bank in the country — and it still runs wealth management. Chemung Canal Trust Company in Elmira, New York was founded in 1833 and has held trust powers since 1903. Farmers and Merchants Trust Company in Pennsylvania has carried "trusted since 1920" in its identity for a century. These institutions hold what no charter applicant can buy — family names on accounts and the family names on the lobby wall. In the middle sit the trust divisions inside community and regional banks — a handful of officers administering a few hundred million to a few billion, profitable but subscale, loved by the CEO for the fee income and starved by the budget for everything else. At the top are the large private banks such as PNC, Northern Trust, the wirehouse trust companies with the scale to invest in digital delivery and the reach to compete for the same families the community institutions have served for generations.
The numbers frame the stakes. Roughly one in three of America's 4,250 insured banks holds trust powers — about 1,450 institutions by the FDIC's own data — some 1,040 of them with full fiduciary authority. Far fewer exercise those powers, and the number that do shrinks every year. Meanwhile, the fastest-growing fiduciary balance sheets in the country sit somewhere else entirely: 114 South Dakota-chartered trust companies now hold $906 billion — a state record, up 11 percent in 2025 alone — and a handful of newly chartered digital asset trust banks hold no deposits at all. The powers sit dormant on Main Street while the business compounds in Sioux Falls. That is not a technology observation. It is a strategy indictment.
The squeeze on the middle tiers comes from every direction at once. Trust is the fee income every bank CEO says they want more of — recurring, rate-insensitive, sticky across generations — and it runs on the oldest technology in the building. The trust accounting market is a short list of established players — SEI's Trust 3000, FIS, Fi-Tek, SS&C — a handful of specialists, most with lineage measured in decades, wrapped in nightly batch cycles and integration models that predate the API. The modernization wave that consumed retail banking never reached the trust department. It was too small a line of business to justify the project, year after year, for thirty years. Then add the competition, which is unbundling the very package a trust department sells. Directed-trust statutes let an RIA keep the investment authority and the fee that comes with it, while the administrative trusteeship moves to a low-cost company in a no-tax state. The private banks are pressing down-market with digital delivery the community trust department cannot match. And the talent is walking out the door, as veteran trust officers retire faster than banks replace them. The market has responded the way markets do: a growing share of trust departments now outsource investment management and operations rather than modernize them. Build-versus-buy in trust increasingly looks like buy-versus-exit.
Here is why the timing is unforgiving. Cerulli projects $124 trillion in wealth will transfer through 2048, with Generation X the most immediate recipient. Economists argue about the exact number; no one argues about the direction. Every dollar of that transfer touches what a trust division sells: estate settlement, trusteeship, custody, the orderly movement of assets between generations. Banks with trust powers hold a structural advantage in that flow. What too many lack is the capability to serve the heirs — digital access, modern reporting, responsive administration, and the ability to hold what the next generation actually owns. That last point is no longer theoretical. The question is not whether your trust charter permits digital assets. It is whether your trust core can process them.
Play it forward and the picture sharpens differently for each tier. The new trust banks will industrialize custody — programmable, real-time, API-native — and reset client expectations for fiduciary infrastructure the way fintech reset them for payments. The private banks will follow fastest, pressing scale down-market. For the community trust company, the future runs through the asset it already owns: the relationship. A century of local trust is exactly what a $124 trillion transfer rewards — paired with modern delivery, which for most means partnering on operations and technology while keeping the fiduciary judgment in-house. For the bank trust division, the question reaches the board agenda within a planning cycle or two: (1) invest to compete, partner to scale, or (2) exit while fiduciary fee streams still command a premium. And the vendor market itself — small and aging — is a consolidation story waiting to happen; apply the discipline we apply everywhere else, starting with who owns the roadmap. The one decision the next decade will not reward, at any tier, is the one most trust operations have made for the last three: deferral.
The irony is worth sitting with. The industry that invented holding other people's assets for the long run has run its own trust operations on the shortest of horizons — one deferred modernization at a time. The newcomers chose the trust charter because they saw what the incumbents forgot: fiduciary infrastructure is a growth business. The $124 trillion is already moving. The charters are already granted. The only open question is whether the banks that have held these powers for a century will show up for the decade that finally rewards them.
Tomorrow, we will publish our Sector Spotlight on trust operations technology — a map of the vendors behind trust accounting, tax, estate workflow, and digital asset custody, who owns each player, and what to look for in an evaluation. This piece is the why; the Spotlight is the who.
CCG Catalyst advises community and regional banks, credit unions, and fintech companies on a variety of strategies, technology evaluation, and charter decisions. If your institution is weighing what to do with its trust business — invest, partner, or exit — or evaluating the systems underneath it, reach out to our team at www.ccgcatalyst.com, or see the full library at CCG Insights.
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By: Paul Schaus | Founder & Managing Partner, CCG Catalyst Consulting
Disclaimer: The views expressed in this article represent the perspective of CCG Catalyst Consulting based on our direct experience advising financial institutions. This commentary is intended to stimulate industry discussion and does not constitute legal, accounting, or regulatory advice.
