Circle wins final regulatory approval to establish US trust bank, shares rise
July 10 (Reuters) - Circle said on Friday it has received a final regulatory approval from the U.S. Office of the Comptroller of the Currency to establish a national trust bank, sending the stablecoin giant's shares surging 10% in premarket trading.
Here are some details:
• The charter allows Circle to act as custodian for its own reserves and hold crypto assets on behalf of institutional clients.
• "OCC approval to establish Circle National Trust marks a defining step in bringing blockchain technology and digital assets into the core of the U.S. financial system," Circle CEO Jeremy Allaire said in a statement.
• Circle said the approval places its trust bank under direct federal oversight by the OCC, the primary regulator for lenders and national trust banks.
• As regulatory hurdles eased, digital asset firms have expanded into traditional finance, pursuing banking licenses, custody businesses and payment services over the past year.
• Circle issues USDC, a dollar-pegged stablecoin. Stablecoins are cryptocurrencies designed to maintain a fixed value, usually through a 1:1 peg to the U.S. dollar, and are widely used to transfer funds between crypto tokens.
• USDC has a market value of about $73.2 billion, according to CoinGecko.
• Circle shares have fallen 20.5% so far this year, through last close, giving it a market capitalization of about $15.7 billion, according to LSEG data.
(Reporting by Manya Saini in Bengaluru; Editing by Shilpi Majumdar)