Circle Moves To Establish National Trust Bank In US Following $18 Billion IPO | Bitcoinist.com

Trusted Editorial content, reviewed by leading industry experts and seasoned editors. Ad Disclosure Circle (CRCL), issuer of the market’s second largest stablecoin, USDC, is applying to establish a national trust bank in the United States. This announcement follows Circle’s recent Initital Public Offering (IPO), which valued the company at nearly $18 billion

Circle Seeks OCC Approval

If approved by the US Office of the Comptroller of the Currency (OCC), the new entity, named First National Digital Currency Bank, N.A., will allow Circle to serve as a custodian for its reserves and manage crypto assets on behalf of institutional clients.

Circle’s CEO, Jeremy Allaire, emphasized the company’s commitment to trust, transparency, and compliance during an interview with Reuters. He stated, “Becoming a publicly traded company is a significant part of that, and becoming a national trust company is again a continuation of that.”

Related Reading: Crypto Reserve In The Works, Says Kazakhstan’s Central Bank ChiefUnlike traditional banks, this new charter will not permit the stablecoin issuer to accept cash deposits or issue loans, marking a distinct approach to banking within the digital asset space.

Currently, Circle’s reserves are managed at BNY Mellon and BlackRock, backed by a mix of short-term Treasury bills, cash, and other liquid assets. The proposed national trust bank would primarily focus on custody services for tokenized assets, such as stocks and bonds, rather than traditional cryptocurrencies like Bitcoin (BTC) or Ethereum (ETH)

Upcoming Stablecoin Legislation

This initiative comes at a crucial time as Congress moves closer to enacting a federal regulatory framework for stablecoins. The recently passed stablecoin bill, the GENIUS Act, mandates that stablecoins be backed by liquid assets and requires issuers to disclose their reserve compositions monthly

With the House of Representatives poised to vote on the legislation soon, and US President Donald Trump expected to sign it into law, the regulatory environment for stablecoins is on the verge of significant change

Allaire remarked on the transformative potential of this regulatory shift, stating, “We’re going from the early-adopter phase of this technology into the mainstream.”

He expressed optimism that securing approval for the national trust charter would provide a solid foundation for institutions to build upon, further legitimizing the role of stablecoins in the financial ecosystem.

CRCL Closes At $180

Per the report, Wall Street’s initial response to Circle’s growth has been largely positive, with several major brokerages, including Barclays and Bernstein, issuing “buy” ratings and setting price targets above $200 for the company’s stock

Related Reading: ETF Expert Says Ripple Closing This Chapter Clears The Way For XRP ETF, BlackRock To Join The Race?However, some analysts have expressed caution regarding the stock’s valuation, which has more than doubled since its market debut. As of press time, CRCL closed Monday’s trading session at $180, representing a nearly 40% drop from its $299 record achieved last week

The 1-hour chart shows CRCL’s valuation drop. Source: CRCL on TradingView.comAllaire concluded by highlighting Circle’s approach in aligning with emerging US regulations. He noted that the establishment of a national digital currency trust bank represents a significant milestone in the quest to create a transparent, efficient, and accessible internet financial system

Featured image from DALL-E, chart from TradingView.com

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