Stablecoin creator Circle has submitted a request to create a national trust bank in the United States which, among other responsibilities, would manage the firm’s USDC reserves for its US issuer.
If the submission receives the green light from the US Office of the Comptroller of the Currency (OCC), Circle’s First National Digital Currency Bank would be permitted to function as a federally supervised trust entity, Circle mentioned in a declaration on Monday.
Circle’s Digital Bank also aims to enhance the framework that “facilitates the issuance and distribution” of USDC (USDC) and provide digital asset custody services to institutional clients, the stablecoin creator further noted.
National Trust Banks are not permitted to accept cash deposits or extend loans. Nonetheless, they can provide custodial services and operate on a national scale under the oversight of the OCC, eliminating the need to secure individual state-based money transmission licenses or particular digital currency permits, as stated by the law firm Davis Wright Tremaine.
GENIUS Act compliance
Circle indicated that a federally regulated trust charter would also aid in fulfilling requirements under the proposed GENIUS Act, which was passed by the US Senate on June 17 and has moved on to the House of Representatives, where it will undergo another vote before potentially becoming legislation.
Circle’s co-founder and CEO Jeremy Allaire commented that Circle is taking “proactive measures to further fortify our USDC infrastructure” and “conform to emerging US regulations for the issuance and functioning of dollar-pegged payment stablecoins.”
Applications for National Trust Banks to the OCC are subject to a 30-day commentary period, and the regulator typically decides to permit or reject within 120 days of receiving a complete application.
Other crypto companies also pursuing bank charters
Circle is not the sole crypto organization looking to establish a national trust bank regulated by the OCC.
Eleanor Terrett, host of the Crypto in America podcast, stated in a post on X that multiple other crypto firms, including the digital currency segment of major financial services company Fidelity, are applying for a national bank charter from the OCC.
Circle has been contemplating a bank charter since at least 2022 and was also referenced in The Wall Street Journal article on April 21 as one of multiple crypto firms thinking about applying for a bank charter or license.
Related: Circle stock becomes the largest part of VanEck’s digital asset index
Anchorage Trust Company was the first crypto firm to obtain a license from the OCC in January 2021, transitioning to Anchorage Digital Bank.
Circle’s stock remains steady
Circle Internet Group (CRCL) shares have shown little change in the latest trading session, increasing 0.48% to $181, according to Google Finance data indicates. In after-hours trading, the stock fell 1.30% to $178.
After its public listing, Circle stock made a notable debut in the market on June 5, soaring 167% in its initial trading session on the New York Stock Exchange.
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