Circle Applies for U.S. National Trust Bank to Directly Oversee USDC Reserves

Jimmy Aki
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On June 30, Circle, the issuer of the USDC stablecoin, submitted an application to establish a national trust bank in the United States.

If the Office of the Comptroller of the Currency (OCC) approves the application, the proposed First National Digital Currency Bank would operate under federal regulation and directly manage Circle’s USDC reserves in the U.S.

Bold Move to Unite Traditional Banking and Blockchain

According to Circle’s press release, the proposed bank would also provide secure custody services for institutional investors, including tokenized stocks, bonds, and other real-world assets traded on blockchain networks.

By doing so, Circle seeks to become a key player in securing digital versions of traditional financial assets.

Jeremy Allaire, the company’s co-founder and CEO, called this a major step. He said creating a government-approved trust bank for digital money could help build a more open and efficient financial system.

https://twitter.com/jerallaire/status/1939781323117228543

The timing of this application aligns with strong market momentum. Following its IPO, Circle’s public stock performance has been steady, with shares trading at $181.29 (a 0.48% increase) by the end of June, reflecting a wave of investor confidence.

Banks vs. Crypto: The Race to Dominate the Stablecoin Era

Clearer rules have boosted this progress. The U.S. Senate recently passed the GENIUS Act, which sets clear guidelines for stablecoins, including ensuring they’re fully backed by reserves, regularly audited, and follow anti-money laundering rules.

More importantly, the bill allows banks, fintech companies, and large retailers to create their own stablecoins or integrate them into their existing systems, making it easier for people to use them in everyday transactions.

Circle isn’t the only firm seeking a national trust bank charter.

Eleanor Terrett, host of Crypto in America, reported that other major firms, including Fidelity Digital Assets, are also seeking OCC approval. If approved, Fidelity could operate nationwide without needing to secure individual state money transmission licenses. So far, Anchorage Digital remains the only company to have obtained this charter.

https://twitter.com/EleanorTerrett/status/1939808863064105004

The final call on these applications rests with incoming OCC chair Jonathan Gould, whose confirmation is still pending in the Senate. A policy change could expedite approvals and alter the way financial services operate nationwide.

Meanwhile, traditional banks aren’t just watching from the sidelines. Reports suggest that major financial institutions, including JPMorgan, Bank of America, Citigroup, and Wells Fargo, are collaborating to create their own stablecoin.

This new digital currency would be backed by cash and U.S. Treasury bonds. Their goal is to facilitate faster and easier money transfers between banks while remaining competitive in today’s fast-changing, tech-driven financial landscape.

https://twitter.com/PiQSuite/status/1925734279910133958

With both crypto-native and legacy institutions vying for influence, Circle’s trust bank could mark the beginning of a new chapter, where digital currencies are not just part of the system but central to it.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.