In a move that could weave cryptocurrency more deeply into the fabric of the U.S. payments industry, Circle Internet Group Inc. announced late Monday it has applied to the Office of the Comptroller of the Currency to form a national trust bank. The application, which seeks to establish what Circle calls the First National Digital Currency Bank N.A., appears to be the first by a front-rank cryptocurrency issuer in the U.S. market and represents the latest move by a digital-currency firm to bring crypto money into mainstream financial services.

If approved, the bank will oversee Circle’s management of the reserve for its USDC stablecoin under oversight by the OCC. It will also offer custody services for digital assets offered by institutional customers,  says.

The New York City-based company’s move to form a bank comes as Congress mulls two bills that seek to regulate the nascent but growing stablecoin business in the U.S. The passed the Senate last week and is under consideration in the House of Representatives, which has formulated its own proposed set of rules for the industry, the . 

With its own bank, “we will align with emerging U.S. regulation for the issuance and operation of dollar-denominated payment stablecoins, which we believe can enhance the reach and resilience of the U.S. dollar, and support the development of crucial, market neutral infrastructure for the world’s leading institutions to build on,” said Jeremy Allaire, Circle’s cofounder, chairman, and chief executive, in a statement.

Circle’s move to establish a bank is not the first by a digital-currency player, but represents a major step toward establishing stablecoins as a widely used and accepted form of money, observers say. “It’s easier for the masses to understand,” says Cliff Gray, proprietor of the payments advisory Gray Consulting.

Still, moves toward forming a bank have been relatively rare among cryptocurrency issuers and exchanges, and the process can take years. Anchorage Digital formed Anchorage Digital Bank in 2021. Paxos applied for a national banking charter in the same year and won conditional approval from the OCC, but its application expired in 2023.

But owning a bank can confer advantages, observers say, particularly with consumers and potential partners. “Crypto does not require an intermediate bank, but if the involvement of a bank makes it more understandable, that’s a plus,” notes Gray.