PANews reported on March 13 that according to The Information, as banks warm up to cryptocurrencies, Bank of New York Mellon (BNY) is expanding its services for stablecoin issuer Circle. People familiar with the matter said that the bank will allow some customers to remit or receive money from Circle through BNY to buy or sell Circle's stablecoins. Previously, Circle's customers had to use small banks in the United States to remit money to Circle, which may limit the development scale of the stablecoin company.
The new arrangement facilitates the creation and redemption of Circle's stablecoins, which could help New York-based Circle push for wider adoption of its dollar-pegged stablecoins by other traditional financial institutions. "BNY and Circle will continue to work to bridge the gap between traditional and digital finance and explore how to deepen our relationship to benefit the financial markets," the two companies said in a joint statement. The changes will help make Circle more attractive to investors ahead of a possible initial public offering (IPO), the report said.
The partnership with BNY is notable because the company is a global systemically important bank (G-SIB), a regulatory designation that subjects it to particularly strict supervision. Using a large U.S. bank like BNY is a way for Circle to differentiate itself from competitors such as Tether. Some people familiar with the matter said BNY has approval from the New York State Department of Financial Services to provide Circle with a wider range of payment services. By providing services to Circle, BNY may also attract more crypto-related deposits. People familiar with the matter previously said that the company has been discussing providing banking services with more crypto companies, but has been cautious and only works with the safest companies.
