Fintech Rundown (06/04) - Monzo, Coinbase, Tether

Monzo is shutting down its business in the US after struggling to push into the market, and will be doubling down on its growth in the UK and Europe. The digital bank said it was making a “deliberate” and “strategic” decision to leave the US. The company struggled to get a foothold in the US and abandoned an application for a banking licence in 2021 when it was told it was unlikely to be approved. The digital bank hired a new leadership team in 2023 in the hope of getting another shot at expansion in the market, but it seems now the effort was unsuccessful!

Coinbase wins initial bank regulator nod for trust charter. This conditional OCC approval moves it closer to operating as a federally regulated crypto custodian. The preliminary green light requires Coinbase to build out compliance systems, hire key staff, pass regulatory reviews, and demonstrate strong risk management and AML controls before it can secure a full charter. For institutions, custody is less about trading and more about trust. A pension fund, for example, may want exposure to bitcoin but needs a regulated entity to hold the asset securely. A federal charter can provide that assurance in a way state licenses may not.

Stablecoin issuer Tether will likely postpone its current fundraising effort if too few investors commit to the deal within the next two weeks. The company has been working to raise funds since late last year but has encountered investor concerns about the $500 billion valuation it is seeking, according to the report. The report also said that a $500 billion valuation would surpass that of every U.S. bank except JPMorgan Chase and that Tether faces growing competition in stablecoins.

That’s your fintech rundown. Stay tuned for more updates.