Circle Official Denies Federal Bank Charter Pursuit
In a recent development, a high-ranking official from Circle, a prominent issuer of stablecoins, has refuted claims suggesting that the company is pursuing a federal bank charter in the United States. Dante Disparte, Circle’s chief strategy officer and global policy head, took to social media on April 25 to clarify the firm’s intentions, stating there is no active interest in acquiring a federally insured bank or pursuing a bank charter.
Instead, he highlighted Circle’s commitment to adhering to upcoming regulatory frameworks concerning payment stablecoins, which may necessitate either a federal or state trust charter or an alternative nonbank license.
Call for Regulatory Clarity
Disparte also called on lawmakers to provide clearer regulatory guidance on stablecoins promptly, a sentiment echoed in light of growing scrutiny over how these digital assets are regulated in the country. This statement comes amid reports indicating that several major players in the cryptocurrency sector—Circle included—are contemplating the possibility of applying for banking licenses.
Among the firms mentioned alongside Circle are BitGo, Coinbase, and Paxos, all of which are exploring or have already made steps toward licensure.
Industry Mixed on Bank Licensure
Interestingly, while many companies declined to comment on this matter when approached by Cointelegraph, Coinbase confirmed its consideration of a banking license, highlighting the mixed responses from the industry about these potential moves. This isn’t the first instance where Circle has been linked to the pursuit of a US bank charter; Circle’s CEO, Jeremy Allaire, previously stated in an April 2022 Bloomberg interview that they were actively engaging with regulators regarding such a charter, aiming to make progress in this area.
It’s worth noting that the U.S. Office of the Comptroller of the Currency approved a preliminary and conditional bank charter for Paxos back in 2021, further supporting the context of ongoing discussions in the sector.
Regulatory Developments
As the landscape of stablecoin regulation shifts in the U.S., recent legislative actions indicate a more organized approach is in the works. The House Financial Services Committee has recently advanced a Republican-supported bill known as the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act, aimed at instituting stricter federal oversight over stablecoins.
In contrast, the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, which is also under consideration, proposes a more adaptable regulatory framework involving both federal and state oversight, having passed the Senate Banking Committee in March.
