Circle Denies US Banking License Plans, Focuses on Stablecoin Regulation

Circle, the issuer of the USDC stablecoin, has firmly denied rumors suggesting it plans to apply for a US banking license. Dante Disparte, Circle's Chief Strategy Officer, clarified on social media that the company has no intentions to become a bank or any other type of insured depository institution. Instead, Circle is focusing on aligning with future regulations governing payment stablecoins. Disparte stated that the firm is prepared to register under a state or federal trust charter or operate through a non-bank license if necessary.

This denial comes in response to circulating reports suggesting that Circle, along with other major crypto firms, was preparing to apply for banking licenses due to the favorable regulatory environment. The speculation arises from a noticeable shift in how US regulators are approaching the crypto industry. Recently, the Federal Reserve rolled back previous guidance that limited traditional banks’ ability to interact with digital assets, including dollar-based tokens. This reversal is seen by many as a green light for broader crypto adoption.

Disparte emphasized that Circle is committed to helping the US Congress pass stablecoin legislation that supports innovation while protecting consumers. He urged Congress to pass bipartisan payment stablecoin legislation to champion American innovation, stability, and consumer safety. These comments come as the US Congress debates two key bills to shape the future of stablecoin regulation. The first bill is the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act, which recently cleared the House Financial Services Committee. The second bill, the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, is also progressing through the legislative pipeline. These bills propose new standards for liquidity, reserves, and compliance with anti-money laundering rules, aiming to maintain the global influence of the US dollar by building trust around US-based stablecoin issuers.

Circle's denial and focus on regulatory alignment highlight the company's strategic approach to navigating the evolving landscape of stablecoin regulations. By prioritizing compliance and consumer protection, Circle aims to ensure the stability and trustworthiness of its USDC stablecoin. The company's stance also reflects a broader industry trend towards regulatory cooperation and transparency, as stablecoin issuers seek to build a sustainable and compliant ecosystem. As the US Congress continues to debate stablecoin legislation, Circle's proactive engagement with lawmakers and regulators positions the company as a key player in shaping the future of stablecoin regulation.