Circle executive denies claims of seeking US banking license

An executive at major stablecoin issuer Circle denied recent reports that the company is looking to obtain a US federal bank charter.

In an April 25 X post, Circle’s chief strategy officer and head of global policy, Dante Disparte, denied that the company is interested in obtaining a US federal bank charter or acquiring an insured depository institution.

Instead, he explained that Circle intends to comply with future US regulatory requirements for payment stablecoins, “which may require registering for a federal or state trust charter or other nonbank license.” He also urged lawmakers to reach regulatory clarity for stablecoins sooner rather than later.

Source: Dante Disparte

The statement follows recent reports that major cryptocurrency firms, including stablecoin issuer Circle and crypto custodian BitGo, are reportedly considering applying for bank charters or licenses. Other firms cited as seeking such a license in the same report include publicly traded US-based crypto exchange Coinbase and the stablecoin issuer Paxos.

Related: Circle’s EURC grows as trade war pushes euro higher — Analyst

The report was not entirely baseless

Cointelegraph reached out to all the companies cited in the report, requesting a confirmation or denial. All companies except one denied the request for comment, with Coinbase confirming instead that it is currently considering such a license.

Those were also not the first reports of Circle being interested in a US bank charter. In April 2022, Circle CEO Jeremy Allaire said in an interview with Bloomberg that the firm was already in discussions with regulators as part of its efforts to apply for a bank charter “hopefully in the near future.”

Circle did not respond to Cointelegraph’s request for further comment as of publication time.

Another previous report that helps establish the credibility of the claim is that the US Office of the Comptroller of the Currency granted a preliminary, conditional approval for a US bank charter to Paxos in 2021.

Related: Circle considers IPO delay amid economic uncertainty — Report

US stablecoin regulation is evolving

The news comes as US regulators are working to change how stablecoins are regulated in the country. The US House Financial Services Committee passed a Republican-backed stablecoin framework bill earlier this month.

The bill in question is the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act. Another bill also currently moving through the US legislative process is the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act.

The STABLE and GENIUS bills differ in how they would regulate the stablecoin industry, with the former emphasizing strict federal oversight and the latter being more flexible, allowing for both federal and state rules. The GENIUS Act bill was introduced first and passed the US Senate Banking Committee in mid-March.

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