Written by: Pzai, Foresight News
On June 30, stablecoin issuer Circle submitted an application for a U.S. trust bank license to the Office of the Comptroller of the Currency (OCC) and plans to establish a national trust bank in the U.S.; on July 2, Ripple followed suit with its application for a national bank license. Previously, its subsidiary Standard Custody applied for a Federal Reserve master account to directly custody RLUSD reserves. In just four days, the two major stablecoin giants launched critical compliance pushes within the U.S. financial regulatory system.
As one of the important financial strategies during Trump's tenure, the potential demand for stablecoin payments and U.S. Treasury bonds under the dollar system coincides. In the current rapid establishment of the stablecoin industry, why does the stablecoin industry favor U.S. licenses?
The GENIUS Act catalyzes: Federal licenses become a matter of life and death.
The core driving force of this licensing competition is the (GENIUS Act) passed by the U.S. Senate in mid-June (Guiding and Establishing National Innovation for U.S. Stablecoins Act). This act systematically stipulates for the first time that stablecoin issuers must become 'licensed payment stablecoin issuers' and must meet federal or state regulatory requirements.
Two key clauses in the bill directly drive issuers' licensing actions:
Asset custody isolation requirements
The reserve assets of compliant stablecoins must be independently custodied, prohibited from being mixed with the issuer's own funds, and limited to investments in cash, short-term U.S. Treasury bonds, and other highly liquid assets, with a ban on re-pledging or leveraging operations.
In the event of the issuer's bankruptcy, reserve assets, as trust property, will be prioritized for payment to token holders, taking precedence over general creditors.
Qualification thresholds for financial institutions
Issuers must hold federal (OCC/Federal Reserve/FDIC) or 'substantially equivalent' state licenses; unlicensed entities are prohibited from operating in the U.S.
Scaled regulatory tracks: stablecoin issuance ≤ $10 billion can opt for state licenses; exceeding this limit requires mandatory transition to federal licenses, or they must shrink their balance sheet.
The GENIUS Act positions stablecoins as payment tools rather than investment products through two major designs: 'de-interesting' (prohibiting interest payments to users) and 'technical backdoors' (mandating built-in freeze/destroy functions), while also providing a compliance intervention channel for law enforcement agencies.
In the process of stablecoin issuers accelerating their integration into the mainstream financial system, the division between state and federal regulatory systems is profoundly reshaping the competitive landscape of the industry. The fragmented regulation of state licenses leads issuers into compliance difficulties - for example, Ripple's RLUSD still has to spend months reapplying for licenses in states like California and Texas even after passing the stringent BitLicense review by the New York State Department of Financial Services (NYDFS), with application fees ranging from $50,000 to $200,000 and the need to establish localized compliance teams. The disjointed regulatory standards among states further cause operational inefficiencies: audit frequencies of reserve assets vary from quarterly to semi-annually, and disclosure standards differ significantly, forcing stablecoin businesses to design 'to the lowest common denominator'.
Ripple's OCC application goes a step further. It will build upon the existing New York State Department of Financial Services (NYDFS) regulatory framework, layering on federal-level OCC regulation, targeting a 'state + federal' dual regulatory structure. If its subsidiary obtains a Federal Reserve master account, RLUSD reserves will be directly held within the Federal Reserve system. Having reserve licenses at the federal level significantly reduces the costs of cross-domain compliance, and Ripple's CEO Brad Garlinghouse claimed that this will establish a 'new benchmark of trust' for the stablecoin market.
The 2023 Silicon Valley Bank (SVB) crisis caused Circle to be trapped with $3.3 billion in reserves at SVB, leading to panic in the market and a temporary de-pegging of USDC, nearly collapsing market confidence. The core purpose of Circle applying for a national trust bank license is to qualify for self-custody of reserves without relying on commercial banks, completely eliminating the risk of a 'bank run contagion chain'.
The OCC not only achieves nationwide one-time access but also reshapes the industry ecosystem through a threefold mechanism: stablecoin reserves are directly deposited in the central bank system, completely eliminating the risk of commercial bank failures and realizing real-time settlement; at the same time, it grants issuers SEC-certified 'qualified custodians' status to custody tokenized stocks and bonds for institutional clients, allowing Circle to participate in the digital asset custody market; more importantly, the OCC automatically covers state money transmission licenses, uniformly applying its risk-weighted capital standards to avoid regulatory universality issues caused by differences in state capital adequacy ratios.
The pursuit of bank licenses by stablecoin issuers is not an overnight effort but rather a culmination of years of compliance exploration. For example, Circle successfully obtained the first Electronic Money Institution (EMI) license under the EU's MiCA framework on July 2, 2024, allowing it to issue USDC and euro stablecoin EURC compliantly across 27 countries. In the Middle East, Circle received a principle license from Abu Dhabi MSB, targeting key on-chain settlement scenarios for oil dollars.
The high-threshold licensing system established by local regulators has created a strong barrier for this high-cost compliance layout. For example, the high capital requirement (350,000 euros) and operational reserves required by the EU's MiCA have led many small and medium issuers to exit, while Circle was able to seize the entry point into the stablecoin market in the EU, which has a population of 450 million, posing a significant challenge to competitors.
With the advancement of license applications, the positioning of stablecoins has evolved from a mere medium of exchange to a core component of financial infrastructure. Circle's Chief Strategy Officer Dante Disparte stated that federal regulation will make the company a 'dollar chain execution engine', reshaping the global flow of dollars.
