Coinbase officially has a federal bank charter, just not the kind that takes deposits. The exchange announced Monday that Coinbase National Trust Company has cleared the OCC, and the regulator's application records show the charter took effect on Friday, Nov. 6th.

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What's the Scoop?

• Custody, not commercial banking: Under the OCC's April 2nd conditional approval, the bank holds crypto as a fiduciary, mainly for institutions, and lets those clients move cash and crypto within their custody accounts. It can't take deposits or make loans. Client dollars sit in "for benefit of" (FBO) accounts at outside banks, and FDIC insurance doesn't apply.

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• The big migration: Coinbase plans to move all of the custody business at its New York trust company, which NYDFS chartered in 2018, into the federal bank over a three-year window. It hasn't said when the first clients will switch over.

• Affiliates stay separate: Staking, Prime trading, and Prime financing stay in other Coinbase entities. The trust bank can only refer custody clients to those services as a "finder."

• No stablecoin issuance (yet): Some early coverage said Coinbase can now launch its own stablecoin. But the OCC's April letter says the bank "does not propose to issue stablecoins," and any major change to its business plan needs 60 days' notice plus the OCC's sign-off. Coinbase's own statement only calls payments and stablecoins "potential future" services.

• Third this year, under a cloud: After Circle (July 10th) and Ripple (Oct. 26th), Coinbase is the third crypto-native firm this year to win final approval for a brand-new national trust bank. The Independent Community Bankers of America (ICBA) is suing the OCC over the rules behind these charters. In May, the group also asked the regulator to put Coinbase's approval on hold because of New York AG Letitia James' gambling suit against a Coinbase subsidiary.