Crypto exchange Coinbase is urging federal regulators to provide clear guidelines for banks to offer digital asset services, challenging what it sees as unnecessary obstacles in the crypto banking industry.

In letters obtained by Bloomberg, Coinbase reaches out to three major banking regulators, namely the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board of Governors, and the Federal Deposit Insurance Corporation (FDIC).

In these letters, Coinbase specifically requests explicit confirmation that banks are allowed to offer crypto custody and trading services, either directly or through third-party providers.

The largest crypto exchange in the United States in terms of trading volume also argues that although federal laws already permit banks to engage in crypto activities, the lack of regulatory clarity has deterred many institutions from entering the market.

Faryar Shirzad, Coinbase’s chief policy officer, comments on the matter, saying:

“We need clear guidance that banks can collaborate with qualified third-party providers to meet their customers’ crypto needs.”

Yesterday, Coinbase further demonstrated its commitment to working with regulators by obtaining approval from the UK Financial Conduct Authority (FCA) to become the largest Virtual Asset Service Provider (VASP) in the United Kingdom.

“This VASP registration positions Coinbase as the largest registered player in the UK’s digital asset space. The UK government and the FCA are developing favorable regulations for the crypto industry, potentially following the global trend of embracing economic freedom and free markets.

Governments worldwide are recognizing that crypto drives economic prosperity. We firmly believe that crypto is the most significant technology capable of fostering global growth, and the UK is well-positioned to reap the benefits.”

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