As an analyst, I’ve been following the recent exchange between BitGo’s CEO, Mike Belshe, and Senator Elizabeth Warren. Senator Warren raised concerns about the Office of the Comptroller of the Currency approving national trust charters for companies dealing with cryptocurrency, and Mr. Belshe has publicly responded to those concerns, essentially defending the decision.
In a letter posted on X (formerly Twitter) on Wednesday, Belshe explained why BitGo shouldn’t be called a “crypto bank.” He pointed out that BitGo doesn’t accept deposits, lend out customer funds, or use fractional reserve banking. Instead, he stated that the company functions as a trusted custodian, holding client assets securely in separate accounts protected by federal trust law.
Belshe says BitGo is a custodian, not a bank
Belshe responded the day after Warren wrote to the Office of the Comptroller of the Currency, expressing worries that recent approvals might let cryptocurrency companies access banking benefits without following the same rules as traditional banks.
Belshe argues that the comparison is inaccurate, explaining that BitGo doesn’t lend out or trade customer funds. He clarifies that customers retain full ownership of their assets, and BitGo simply acts as a secure custodian, legally obligated to protect those assets under the oversight of the Office of the Comptroller of the Currency. “BitGo doesn’t operate like a traditional crypto bank that takes deposits and lends them out,” Belshe stated.
National trust charter at the center of the debate
BitGo obtained a national trust charter from the Office of the Comptroller of the Currency, enabling it to offer custody and fiduciary services across the country.
According to Belshe, this charter positions the company within a well-known legal structure traditionally used by trusts to protect client assets like stocks, valuable metals, and other non-cash holdings. He explained that trust banks operate under different rules than traditional banks because they don’t face the same risks related to managing deposits and lending money.
BitGo’s head, Belshe, emphasized the company’s secure handling of client reserves, especially for those using stablecoins. He stated that all stablecoin reserves are held in full and are never loaned out or used as collateral. To prove this, BitGo gets independent verification of its reserves twice a month, on top of regular quarterly and yearly audits. Belshe believes this level of openness is greater than what most traditional banks provide.
Response to Warren’s consumer protection concerns
Warren’s letter pointed to the failures of companies like FTX, Celsius Network, and Voyager Digital as proof that crypto businesses can be dangerous for customers. According to Belshe, these collapses weren’t caused by a lack of regulation around holding crypto, but by companies mixing customer funds and lending them out without permission.
He explained that federally overseen trust companies have built-in protections that were lacking in previous incidents. These include keeping customer assets separate from the company’s own finances and a legal duty to prioritize customer interests.
BitGo points to global regulatory footprint
BitGo has been working for years to get the necessary licenses and approvals to operate in places like South Dakota, New York, Switzerland, Germany, Dubai, and Singapore, according to Belshe. He explained that getting a charter from the OCC is a natural next step in this process, not an effort to sidestep regulation.
BitGo provides services to institutions like asset managers, pension funds, and companies that create ETFs, all of whom need secure and regulated custody solutions.
Debate over how crypto firms should be regulated
As I’ve been following the conversation between Warren and Belshe, it’s become clear there’s a significant disagreement about how to regulate digital asset custody firms. The core of the debate seems to be whether these firms should fall under banking regulations or trust/fiduciary standards. Belshe makes a strong point that the *activities* a firm undertakes with client assets should determine the level of regulation, not simply the fact that those assets are digital. Specifically, he believes firms offering simple, one-to-one custody should be regulated differently than those that actively lend out or re-use customer funds.
I finished the letter by extending an invitation to Warren and her team to meet with BitGo. I wanted to give them a chance to learn more about how our company is structured and how we maintain oversight.
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2026-05-20 18:45