Circle Seeks US Trust Bank Charter to Manage USDC Reserve Under GENIUS Act Scrutiny

Circle applied to the Office of the Comptroller of the Currency (OCC) to form a Circle trust bank named First National Digital Currency Bank, according to a company statement on July 1. The bank would oversee the USDC reserve and offer digital asset custody services for institutional clients.

The Circle national bank would operate under federal oversight, avoiding the need for state-by-state licenses. It would not accept deposits or issue loans but would provide custodial services nationwide.

The move aims to improve infrastructure around Circle stablecoin issuance.

GENIUS Act Compliance Tied to Circle Charter Bid

Circle said the Circle charter would support compliance with the proposed GENIUS Act, which passed the U.S. Senate on June 17. The bill awaits a vote in the House of Representatives. It sets federal standards for dollar-based stablecoin operations.

The company noted that a federal charter would streamline its regulatory obligations.

Jeremy Allaire, Circle CEO, stated:

“We are taking steps to strengthen our USDC infrastructure and align with emerging U.S. regulation.”

The OCC application process includes a 30-day public comment period, with decisions generally issued within 120 days.

Fidelity and Others Pursue OCC Charter

Eleanor Terrett, host of Crypto in America, posted that other firms, including Fidelity crypto bank, are also applying for a national trust bank license.

Anchorage Trust Company became the first crypto firm to secure OCC approval in January 2021, converting into Anchorage Digital Bank.

Circle has considered a charter since 2022, as noted in an April 21 report by The Wall Street Journal.

Circle stock closed at $181 on July 1, up 0.48%. After-hours trading saw a drop to $178, according to Google Finance.

Circle Internet Group (CRCL) listed on the New York Stock Exchange on June 5, gaining 167% on the first day. Since then, trading has remained stable.