Stablecoin Issuer Circle Applies to Launch Government-Supervised Crypto Bank Just Weeks After Record IPO: Is This the Future of Crypto Banking?

Circle Moves To Launch First National Digital Currency Bank After $18 Billion IPO

Fresh off its blockbuster debut on Wall Street, Circle Internet Group is making its most ambitious move yet—applying for a national trust bank charter from the US Office of the Comptroller of the Currency (OCC).

If approved, the stablecoin giant behind USDC will operate a federally regulated institution called First National Digital Currency Bank, N.A.

This new entity would enable Circle to manage its own reserves and offer digital asset custody services directly to institutional clients—without taking cash deposits or issuing loans like a traditional bank.

A Shift Into Regulated Banking Territory

While Circle has previously denied interest in certain banking licenses, CEO Jeremy Allaire has made clear that the company is now fully embracing the path toward becoming a regulated institution.

Allaire said,

“Becoming a publicly traded company is a significant part of that, becoming a national trust company is again a continuation of that.”

This reaffirms Circle’s long-standing focus on “trust, transparency, governance, and compliance.”

If successful, Circle would join Anchorage Digital as one of the few crypto-native companies operating under a national trust charter.

Unlike Anchorage, which secured its OCC charter back in 2021, Circle’s new bank would specifically focus on managing USDC reserves and tokenised assets for institutional clients.

Why It Matters For Institutional Crypto Adoption

Circle’s application arrives just as institutional interest in stablecoins hits new highs.

The recent passage of the GENIUS Act by the Senate—and growing pressure from President Donald Trump to finalise the bill—has sharpened regulatory clarity around stablecoin operations.

The proposed law would require all stablecoin issuers to hold liquid backing and publicly disclose reserve composition monthly.

Circle, now trading under ticker symbol CRCL, is positioning USDC to be the most compliant and regulator-friendly stablecoin in the market.

Analysts at Bernstein recently said USDC is poised to lead in the regulated stablecoin race under the new rules.

If the trust bank is approved, Circle will be allowed to provide custody for tokenised versions of traditional assets—such as equities and bonds—rather than focusing on holding cryptocurrencies like Bitcoin or Ethereum.

Its reserves, currently managed by BlackRock and held at BNY Mellon, would shift under the oversight of the new federally chartered entity, though some assets will remain with traditional banking partners.

Circle’s Stock Soars Then Stumbles

The timing of the bank charter application closely follows Circle’s high-profile IPO, which saw shares more than double on their first day of trading.

Initially priced at $31, the offering was 25 times oversubscribed, signalling intense demand from both crypto-native and traditional investors.

Shares surged to a peak of nearly $299 before falling back to $181.29 by 30 June.

Source: Yahoo! Finance

Despite the early market euphoria, not all analysts are convinced the valuation holds.

JPMorgan placed a price target of $80 on the stock, citing concerns over its current valuation.

Other firms like Barclays, Bernstein, and Canaccord Genuity remain bullish, setting targets above $200.

What Circle’s Next Move Says About Crypto’s Maturity

Circle’s pivot from private tech firm to public financial institution, and now toward becoming a federally regulated trust bank, is no small step.

It’s a signal of how far stablecoin issuers are willing to go to align with mainstream finance and meet rising regulatory expectations.

As Allaire put it,

“We are going from the early-adopter phase of this technology into the mainstream.”

With over $61 billion in USDC circulation and growing pressure from institutional clients, Circle’s infrastructure is evolving to support what it hopes will be the next generation of global finance.

The Real Bet Circle Is Making

In a market where speed and hype often win headlines, Circle is quietly betting on credibility.

By choosing regulation over ambiguity, transparency over opacity, and financial infrastructure over experimentation, the firm is repositioning itself not as a crypto disruptor—but as a long-term partner to the world’s financial giants.

Whether rivals follow suit may determine who leads the next chapter of the digital dollar.