Stablecoin giant Circle gets green light to establish a trust bank, sending its stock up 5%.

Circle, a giant stablecoin provider, has received approval from the US OCC to establish a trust bank, boosting its stock by 5%. This unlocks its ability to directly manage USDC reserve assets.

July 11, 2569 (CNBC) – Circle is a company that provides stablecoin services. announced that The company received approval from the U.S. Office of Financial Control (OCC) last Friday to operate as a trust bank. This resulted in an immediate surge in the company's share price. Although the share price retraced from its day's high towards the end, it still managed to close nearly 5% higher.

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This approval allows the company to manage its stablecoin reserves directly under its own supervision. In particular, the USDC coin currently has a circulating value of over $7.3 billion.

This new bank will operate under the name Circle National Trust. Previously, Circle relied on external commercial banks and custodians to hold the cash and government bonds that backed the value of the USDC coin.

A key limitation is that the license (Charter) does not permit Circle to operate as a regular commercial bank; therefore, the company cannot accept deposits or provide loans.

Upgrading to a "financial infrastructure".

This reflects a broader trend in the cryptocurrency industry. As companies try to transform themselves from being merely... "Financial applications" Towards becoming... "Financial Infrastructure"

In recent times, the OCC has approved or accepted similar requests from several other large companies, such as Coinbase, BitGo, Fidelity Digital Assets, Ripple, and Paxos, reflecting fierce competition to own shares in regulated financial systems.

Dante Disparte, Chief Strategy Officer of Circle. He gave an interview to CNBC stating that... This trust bank structure can also help simplify legal requirements for international trading partners.

“We consider ourselves pioneers in ensuring that, from the early days of stablecoins entering the trading system, they have adhered to standards of trustworthiness, transparency, security, compliance with anti-financial crime laws, and more. Today’s announcement represents formal certification of those at the US (Federal) level.” Disparte said:

Furthermore, this license places Circle under the supervision of a national banking authority, rather than state-based regulation. This addresses a major pain point for fast-growing startups in the highly regulated financial services industry, where companies often face slightly different regulations across 50 states instead of adhering to a single set of rules, hindering growth and increasing costs.

The trigger was the GENIUS Act and fierce competition.

The stablecoin battle has heated up since the passage of the GENIUS Act nearly a year ago. This law establishes a US-level framework for payment stablecoins. Under this law, major stablecoin providers like Circle are required to obtain a license from the OCC.
This has led traditional financial institutions to increasingly seek to issue their own stablecoins, posing a growing competitive challenge to USDC.

Because these financial institutions can control the flow of payments, strengthen customer relationships, and build on-premise financial services on programmable digital dollars without relying on external issuers like Circle.

Additionally, on the same day that Circle received approval, Swift, the global financial messaging network, launched a blockchain alliance with 17 banks, including Citi and HSBC, to promote a 24/7 payment system and compete in the stablecoin market.

Furthermore, last June, a coalition of over 140 companies, including giants like Blackrock, Coinbase, Mastercard, Stripe, and Visa, joined the effort to create a new stablecoin called Open USD (OUSD), where reserve yields will be distributed among participating partners instead of going to a single issuer.

(Note: The OCC has not yet responded to CNBC's request for comment.)

refer : www.cnbc.com

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