Circle Seeks OCC Charter for Digital Currency Bank to Manage USDC Reserves

Circle, the issuer of the USDC stablecoin, has formally applied to the U.S. Office of the Comptroller of the Currency (OCC) to establish First National Digital Currency Bank, N.A. This new entity would operate as a federally regulated trust bank, focusing on custodial services rather than traditional banking activities. The move comes shortly after Circle’s successful IPO and reflects its push to strengthen stablecoin infrastructure ahead of evolving U.S. regulation.

The OCC charter, if approved, would authorize Circle to directly manage a portion of the USDC reserves. Currently, these reserves—consisting of U.S. Treasury bills, repurchase agreements, and cash—are managed by BlackRock and held in custody at BNY Mellon. The trust bank would allow Circle to bring part of this operation in-house, enhancing control and transparency over its stablecoin backing. However, the trust bank would not function as a traditional financial institution. It will not accept customer deposits or provide lending services. Instead, its core function will center on safeguarding digital and tokenized assets for Circle and its institutional clients.

The trust license would also empower Circle to offer custodial services for tokenized securities such as stocks and bonds. While many firms focus on cryptocurrencies like Bitcoin and Ethereum, Circle plans to prioritize real-world assets represented on blockchain networks. This strategy positions the firm to support the next phase of institutional blockchain adoption. The application builds on Circle’s long-standing regulatory track record. In recent years, the company became the first to secure a NYDFS BitLicense, and more recently, complied with the EU’s MiCA framework. It also received in-principle approval in Abu Dhabi to operate as a money services provider.

Circle’s move comes as U.S. lawmakers near finalization of federal stablecoin legislation. The Senate has passed a bill mandating that stablecoins be backed by liquid assets and that issuers disclose reserve compositions monthly. The House is expected to approve it soon, with President Donald Trump likely to sign it into law. This legislative progress signals a shift toward regulatory certainty in the digital asset space. Circle appears to be positioning itself ahead of this shift by pursuing a federally recognized trust charter, which would meet anticipated compliance requirements under the proposed GENIUS Act.

With the trust bank initiative, Circle seeks to reinforce its infrastructure and credibility as the USDC issuer, preparing to serve a broader base of institutional partners under a transparent regulatory framework. This strategic move is aimed at strengthening the infrastructure of USDC, meeting the requirements under the proposed GENIUS Act, and expanding institutional services. The approval of this charter would bring Circle under direct OCC oversight, aligning it with the regulatory framework that governs traditional financial institutions. The national trust bank charter would enable Circle to act as a custodian for its own reserves and hold digital assets on behalf of institutional customers. This development is significant as it would allow Circle to offer custody services for a broader range of digital assets, enhancing its ability to serve institutional clients. The proposed trust bank will not engage in traditional banking services such as taking deposits or issuing loans. Instead, it will focus on managing Circle's USDC reserves and providing digital asset custody services.