GoKawiilStablecoin issuer Circle surged after the U.S. Office of the Comptroller of the Currency, or OCC, granted it approval Friday to operate as a trust bank, the company said.
Shares of the company were off their initial highs but last trading up 5%.
The approval gives the company the ability to manage reserves directly for its regulated stablecoins, primarily the USDC stablecoin, which has more than $73 billion in circulation. The new bank will operate under the name Circle National Trust. Previously, Circle needed third-party banks and custodians to hold the cash and Treasury assets backing USDC.
The charter does not greenlight Circle to operate as a commercial bank that takes deposits and makes loans.
The news reflects a broader trend in the crypto industry, where companies are trying to make a big shift from being financial applications to financial infrastructure. Recent OCC actions have included approvals or applications from Coinbase , BitGo , Fidelity Digital Assets, Ripple and Paxos, reflecting the race to own more of the regulated financial stack.
Additionally, the charter gives Circle a national bank regulator, rather than being subject to state-based regulation – a major pain point for fast-paced startups playing in the heavily regulated financial services industry. Instead of a single rulebook, companies regularly face 50 slightly different ones that not only can slow growth but also increase costs.
The stablecoin race has been heating up after Washington nearly a year ago brought greater regulatory clarity to digital assets with the GENIUS Act, which established a federal framework for payment stablecoins.
As a result, traditional financial firms increasingly want to issue their own stablecoins – which presents a growing competitive challenge for USDC – because they can capture payment flows, deepen customer relationships and build financial services on top of programmable digital dollars rather than relying on third-party issuers like Circle.
The OCC charter approval comes on the same day global financial messaging network Swift launched a blockchain consortium with 17 banks, including Citi and HSBC, in a 24/7 payments push to help it 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.
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