Circle Internet Group, parent company of USDC issuer Circle, received final approval to set up a national trust bank in the US. The news sent shares soaring 14.6% in premarket trading, adding $2.3 billion to its market cap. This brings Circle's total market value to around $15.7 billion.
The new bank will initially focus on holding digital assets for Circle and its affiliates. However, direct custody for outside institutions will depend on demand. The authorization does not grant Circle a full commercial-bank license, limiting the scope of its activities.
Circle's CEO Jeremy Allaire believes that federal regulation will provide clarity and confidence for financial firms working with public blockchains. Despite this optimism, the company faces challenges in the form of intense competition from other stablecoin issuers like Tether.