Circle Wants to Open a Bank. What That Means for the Stablecoin Giant. — Barrons.com

By Nate Wolf

Stablecoin issuer. Hype stock. Crypto giant. Circle Internet Group now has another title in its sights: bank.

Circle has submitted an application to the Office of the Comptroller of the Currency (OCC) to establish a national trust bank called First National Digital Currency Bank, N.A., the company said Monday. The bank would both oversee the company's own reserves of USDC, its dollar-pegged stablecoin, and offer "digital asset custody services" to institutional clients.

The company described the application as an effort to align with the Genius Act, a bill advanced by the Senate in June that would require stablecoin issuers to hold reserves of safe, liquid assets like cash or Treasuries. Circle currently holds $61.9 billion in both Treasuries and cash in reserve — to match $61.6 billion USDC in circulation — at Bank of New York Mellon.

"By applying for a national trust charter, Circle is taking proactive steps to further strengthen our USDC infrastructure," said CEO Jeremy Allaire in a statement. "Further, we will align with emerging U.S. regulation for the issuance and operation of dollar-denominated payment stablecoins."

The company indicated that the bank also would hold digital assets for institutional affiliates, but a spokesperson confirmed to Barron's that the institution would not serve individual consumers. Typical national trust banks don't accept deposits or offer loans, according to the OCC.

Circle stock was rising 0.6%. The stock has had just two trading sessions with a swing of less than 7% either way since its blockbuster initial public offering on June 5.

Write to Nate Wolf at nate.wolf@barrons.com

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