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Crypto Company Circle Seeks To Become Global Digital Currency Bank

The company behind the increasingly popular USDC stablecoin dreams big. Circle wants to leverage its know-how and good reputation to become “a global digital currency bank.” That means it’s also looking into becoming a digital currency bank in the US. Their plan’s announcement focused on that region of the planet, but the wording makes it clear that they’re ultimately looking for worldwide domination. 

Related Reading | Is USDC’s Billion Dollar Growth A Sign Crypto Smart Money Is Ditching Tether?

According to Coindesk, “this would be an industry first, with a scope far beyond the OCC banking charter already conditionally issued to Anchorage, Paxos and other crypto-native financial services firms.” The company’s aim is to provide “frictionless, instant and nearly free payments that combined fiat reserve currencies with open, permissionless blockchains, and eventually building on these open networks to support new forms of capital formation and intermediation.” 

It’s the project ready for prime time or in its infancy? Did they file the documents already? Will they be able to pull this off? Keep reading for extra clues and info.

USDC price chart for 08/10/2021 on Bitbay | Source: USDC/USD on TradingView.com
Circle Played Nice With Governments From The Get-Go 

The USDC stablecoin is issued by CENTRE, a joint venture between Circle and Coinbase. Their aim is “to conform with stringent U.S. money transmission supervisory and regulatory standards.” In contrast Tether, their main competition, is famous for the probe that the US Department Of Justice launched against them.

The main point of contention against Tether is the reserves they hold to back up their USDT. Attacking their competition’s weak spot, Circle claims, “Establishing national regulatory standards for dollar digital currencies is crucial to enabling the potential of digital currencies in the real economy, including standards for reserve management and composition.” 

Since regulatory compliance is their forte, Circle spends half of their announcement praising their own transparency and USDC’s liquidity even “in times of intense demand to redeem USDC”. To prove that, they provide an independent accountant report that highlights the “composition of USDC reserves, including the credit quality of the underlying assets.”

Related Reading | Tether (USDT) To Face Do or Die Situation in 2021: Messari Report

Why does all of that have to do with their plans to become a national digital currency bank? It proves that they’re in tune with the US Government. 

Now, with USDC at more than $27.5 billion in circulation, and building on our long-standing commitment to trust, transparency and accountability in the dollar-denominated reserves backing USDC, we are setting out to become a U.S. Federally-chartered national commercial bank.
Circle intends to become a full-reserve national commercial bank, operating under the supervision and risk management requirements of the Federal Reserve, U.S. Treasury, OCC, and the FDIC.

Other Big Plans For The Crypto Company

Recently, Circle announced its intention to go public before the end of the year. According to Coindesk, the company “partnered with a special purpose acquisition company (SPAC) to go public later this year. The deal valued Circle at $4.5 billion.” Also, their USDC project will soon go live in multiple blockchains. As NewsBTC informed:

It will soon be available in, “Avalanche, Celo, Flow, Hedera, Kava, Nervos, Polkadot, Stacks, Tezos, and Tron.” That will bring the total to 14; since USDC is already functional in Ethereum, Algorand, Stellar, and Solana.

In related news, NewsBTC recently highlighted a Messari report that shows USDC is the most used stablecoin in DeFi.

From what Ryan Watkins, a credible researcher, predicted, the stablecoin share for Tether on Ethereum could dip below 50%. In addition, Watkins revealed that more than half of USDC’s total supply is now in smart contracts.

The equivalent value for this USD Coin supply is about $12.5 billion. According to Messari, CoinMetrics data estimates show that USDC’s stablecoin supply is over 40% on Ethereum.

However, none of that guarantees that their plans to become a global digital currency bank will come true. Keep the NewsBTC tab open for further information on this developing story.

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Reliving The FUD That Led To This Week’s Bitcoin Crash

It is the worst of times. It is the best of times. It is the age of fear, uncertainty, and doubt. Nevertheless, Bitcoin’s fundamentals remain intact. The project’s value is still there, despite the disastrous drop in price. It was all going so well. How did we get here? Actually, there are a lot of valid reasons. Let’s review all of the causes that lead to this FUD.

As you know, everything started through Elon Musk’s fingertips…

Tesla’s “Environmental Concerns”

When Bitcoin was on its way up, Elon’s company gave it the push it needed. Tesla announced ownership of $1.5B worth of Bitcoin that, apparently, remain on its balance sheet. The crypto community celebrated the move, profits followed. The coin’s legitimization seemed to take a step forward. And then…

Inexplicably, Tesla announced they were not accepting BTC as a form of payment anymore. Despite wild speculation, no one knows what happened. In his tweeted announcement, Elon cited “rapidly increasing use of fossil fuels for Bitcoin mining” as the reason. Few people inside the crypto community believed it. Everyone outside of it did. And even though Tesla clarifies they didn’t sell any of their Bitcoin, the FUD set in. And retail investors started selling.

If you want to learn about Elon’s real views on the matter and about everything the crypto mining industry is doing regarding green energy, head over to Bitcoinist, our sister site.

Related Reading | Bitcoin TA: Here’s What Could Trigger A Bullish Reversal Above $40K

China’s Tightening Up Its Bitcoin Policies

This generated lots of FUD. The People’s Bank of China seemed to announce clear and unfavorable rules regarding cryptocurrencies. Yahoo Finance reports: 

“This is the latest chapter of China tightening the noose around crypto,” said Antoni Trenchev, managing partner and co-founder of Nexo in London, a crypto lender.

Virtual currencies should not and cannot be used in the market because they’re not real currencies, according to a notice posted on the PBOC’s official WeChat account. Financial and payments institutions are not allowed to price products or services with virtual currency, the notice said.

Nevertheless, as with most things on this list, the announcement didn’t amount to anything specific yet. 

BTC price chart on Bitstamp | Source: BTC/USD on TradingView.com

The US OCC Turns Its Eye To Cryptocurrencies

The newly announced Acting Comptroller of the Currency, Michael Hsu, revealed that the agency he presides, the Federal Reserve, and the FDIC are reviewing their policies on cryptocurrencies. This isn’t necessarily a bad thing, it might lead to clearer laws and stronger governmental support. Nevertheless, the FUD doesn’t mind that fact. 

Hsu’s statement to the Committee Of Financial Services reads:

Shortly after I started, I requested a review of key regulatory standards and matters pending before the agency. Those items include the 2020 Community Reinvestment Act (CRA) final rule and associated NPR related to performance benchmarks, interpretative letters and guidance regarding cryptocurrencies and digital assets, and pending licensing decisions. For each, the review is considering a full range of internal and external views, the impact of changed circumstances, and a range of alternatives.

Binance Under Investigation

The US government turned its eye towards Binance. Apparently, blockchain investigator firm Chainalysis found a pattern. It showed a considerably higher percentage of funds from criminal enterprises flowed through Binance, compared to other exchanges. Bitcoin Magazine reports:

The world’s largest cryptocurrency exchange, Binance, is under investigation by the U.S. Department of Justice and Internal Revenue Service (IRS), according to a report from Bloomberg.

“As part of the inquiry, officials who probe money laundering and tax offenses have sought information from individuals with insight into Binance’s business.”

Even though it’s just an inquiry and nothing might come of it, the FUD it generated within the community cannot be ignored. 

Related Reading | Market Sentiment Hits Low As Binance Has Largest Bitcoin Inflow Ever

India almost bans cryptocurrencies

A total crypto prohibition was on the table once again, but India’s lawmakers turned the ship at the last minute. Word on the street is that they’ll pass clearer regulatory laws instead. The Economic Times reports:

The central government may form a fresh panel of experts to study the possibility of regulating cryptocurrency in India, three sources privy of the discussions told ET. This comes amid the prevailing view that the recommendations by a committee headed by former finance secretary Subhash Garg in 2019 for a blanket ban on these assets had become outdated.

This new rumor arrived yesterday, but the FUD that a total ban inspires was around for a while. 

Is This A Coordinated Attack? Or Is The World Just Going Nuts?

We can’t confirm or deny this was a coordinated attack on Bitcoin and cryptocurrencies in general. Maybe the upper class, transnational corporations, and high rollers of all kinds want to buy your BTC at a discount. Market manipulation is as old as markets. But, maybe, this perfect storm of bad news is what happens when the best performing asset that the world has ever seen takes over the world’s headlines. All eyes turn to it, and all fingers start poking.

However…

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