Digital asset firm LevelField closer to buying Burling Bank

• Key insight: A firm in Houston secured Illinois state approval to acquire a community bank in Chicago, moving it closer to its goal of operating a bank that marries traditional banking with digital asset products and services.
  
• What's at stake: The firm is still awaiting approval from the Federal Reserve.
  
• Forward look: Executives expect the acquisition to close by the end of the year.

LevelField Financial in Houston has been on a yearslong journey to open a bank that offers traditional banking and digital asset services on one platform. 

On Monday, it announced that it notched a big win: The state of Illinois has given the thumbs-up to its plan to buy a community bank in Chicago.

The Illinois Department of Financial and Professional Regulation has granted conditional approval to LevelField to acquire Burling Bank, LevelField said in a press release. The financial services firm now awaits the green light from the Federal Reserve to become a bank holding company, which could happen "imminently," LevelField CEO Gene Grant II said.

If the approval comes through as expected, LevelField will be set to operate a full-service bank that unites standard banking with digital assets, Grant told American Banker Monday. He expects the acquisition to be finalized before the end of this year, he said.

"The goal is to be the single bank for consumers and businesses interested in the digital asset class," including buying and selling bitcoin, Grant said. "The idea is, once we have a customer, they don't have to go outside the bank perimeter for anything they want to do in digital assets."

The state of Illinois' approval comes nearly three years after Burling, a $209.5 million-asset bank with one branch and about 20 employees, first agreed to be acquired by LevelField. 

LevelField wound up withdrawing its initial application to buy Burling after it encountered some "unexpected roadblocks with the amount of capital required by regulatory agencies," Grant said.

"We had nowhere near the amount of capital" needed, he said. "Nobody expected that."

The firm worked to secure more capital, and wound up reapplying to buy Burling in late 2024. In the most recent application to the Fed, LevelField disclosed that it will pay about $70 million for the bank. Once regulatory approval is received, it will seek to raise $112.5 million, which will include the cost of acquiring the bank, $20 million in post-acquisition growth capital and $17.5 million that will be retained at LevelField Financial, the firm said in the regulatory filing.

As of December last year, LevelField had commitments for $58 million and expected to obtain commitments for the remaining $54.5 million prior to final regulatory approval, the filing said.

Post-acquisition, Burling Bank, with the exception of its cannabis banking business, will be renamed LevelField Bank. The cannabis business will retain the Burling brand, Grant said.

In addition to traditional banking products and services, new offerings will include loans and credit cards that are collateralized by bitcoin, including lines of credit with a sub-10% interest rate, Grant said. The bank also plans to roll out debit and credit cards with bitcoin rewards.

Burling's president and CEO, Michael Busch, will become president of LevelField Bank, Grant said. All of Burling's employees are expected to join LevelField, which plans to maintain the Chicago branch and also open two deposit-and-loan production offices. One will open in Houston sometime around next summer and another will open in Miami in early 2027, he said.

In a statement to American Banker, Busch said Burling, which was named after Chicago architect Edward Burling, "is eager to move forward with LevelField and expand [its] compelling community banking model to consumers and businesses in the digital asset space."

LevelField, which currently has about 20 employees, is planning to hire about 100 more in 2026. Some of those jobs will be in operations, but most will be in customer service, which will be needed in order to respond to customers' round-the-clock digital assets demands, Grant said.

Under the cryptocurrency-friendly Trump administration, the Office of the Comptroller of the Currency in March reversed Biden-era restrictions on what banks could do with crypto assets. 

It would be "foolish to assume" that LevelField Bank will be "alone in the digital asset space," especially now that LevelField is moving through the regulatory process, Grant said. 

"Crypto is here to stay," he said. "We can either say it's not going to happen and live in denial or we can try to safely integrate it into the financial system in such a way that it works collaboratively and doesn't endanger the system, and we believe the LevelField model does that."