stablecoin issuer circle The company said its stock price soared after the U.S. Office of the Comptroller of the Currency (OCC) authorized it to operate as a trust bank on Friday.
The company’s stock price rose more than 7%.
This approval gives the company direct control over the reserves of regulated stablecoins, primarily the USDC stablecoin, which has over $73 billion in circulation. The new bank will operate under the name Circle National Trust. Previously, Circle required third-party banks and custodians to hold cash and financial assets supporting USDC.
The charter does not give Circle the green light to operate as a commercial bank, accepting deposits and making loans.
This news reflects a broader trend in the crypto industry where companies are making a major shift from financial applications to financial infrastructure. Recent OCC activities include approvals or applications from the following agencies: coinbase, bitgoFidelity Digital Assets, Ripple, and Paxos reflect the race to own more of the regulated financial stack.
Additionally, the charter would make Circle a national banking regulator rather than subject to state-based regulation. This is a major headache for fast-paced startups operating in the highly regulated financial services industry. Instead of a single rulebook, companies are constantly faced with 50 slightly different rulebooks that can not only slow growth but also increase costs.
Stablecoin competition has intensified since Washington state sought to clarify regulations for digital assets nearly a year ago with the GENIUS Act, which established a federal framework for payment stablecoins.
As a result, traditional financial companies increasingly want to issue their own stablecoins, which is increasingly becoming a competitive challenge for USDC. Because instead of relying on third-party issuers like Circle, you can understand payment flows, deepen customer relationships, and build financial services on top of a programmable digital dollar.
The approval of the OCC Charter comes on the same day that global financial messaging network Swift launched a 24/7 payments blockchain consortium with 17 banks, including Citi and HSBC, to help compete in the stablecoin race.
Also in June, a consortium of more than 140 companies including Blackrock, Coinbase, Mastercard, Stripe, and Visa joined the new Open USD (OUSD) stablecoin effort, where reserve yields are distributed to participating partners rather than a single issuer.
The OCC did not respond to CNBC’s request for comment.
