Circle Applies for National Trust Bank to Oversee USDC Reserves

Circle, the issuer of the USDC stablecoin, has officially applied to establish a national trust bank in the United States. The proposed bank, named First National Digital Currency Bank, aims to oversee Circle’s USDC reserves and align with emerging federal regulations. This move is part of Circle’s broader strategy to enhance the infrastructure supporting the issuance and circulation of USDC, as well as to expand its custodial services for institutional clients.

If approved by the Office of the Comptroller of the Currency (OCC), Circle’s new bank will operate as a federally regulated trust institution. National Trust Banks are authorized to provide custody services and operate nationwide under OCC oversight, eliminating the need for state-based money transmitter licenses. This regulatory framework will help Circle meet the requirements under the proposed GENIUS Act, which passed the US Senate on June 17 and is now awaiting a vote in the House of Representatives.

Circle’s co-founder and CEO, Jeremy Allaire, highlighted that the company is taking proactive steps to strengthen its USDC infrastructure while aligning with emerging US regulations for the issuance and operation of dollar-denominated payment stablecoins. The application process for a national trust bank charter involves a 30-day public comment period, with the OCC typically providing a decision within 120 days after receiving a complete application.

Circle is not the only crypto firm seeking a national trust bank charter. Multiple crypto firms, including the digital currency division of a major financial services firm, are pursuing similar licenses from the OCC. This trend reflects the growing interest in the crypto industry to establish more regulated and stable financial institutions. The establishment of a national trust bank would allow Circle to directly manage its USDC reserves, enhancing the stability and reliability of the stablecoin. Additionally, the bank would offer digital asset custody services, providing institutional customers with secure storage solutions for their digital assets. This move is expected to strengthen Circle's position in the market and align its operations with evolving regulatory standards.