Circle, a digital payments company backed by Goldman Sachs, has announced plans to become the United States’ first National Digital Currency Bank.
As co-founder and CEO Jeremy Allaire stated on Monday, the circle is prepared to operate under the Federal Reserve’s supervision.
We believe that full-reserve banking, based on digital currency technology, can lead to a financial system that is more efficient and safer.Allaire said.
The CEO Circle believes USD Coin (USDC) will continue to support high-quality businesses while becoming a popular tool within financial services and ecommerce.
The establishment of national regulatory standards for digital dollar currencies, including reserve management and composition standards, is critical to realizing the potential of digital currencies in the real economy.
The circle is the inventor of USDC (the second-largest stablecoin in the world, after Tether and USDT). USDC was worth $27.8B at this time. USDT was worth close to $63B.
Banks must hold all deposits in cash or cash equivalents and make them available for withdrawal immediately upon demand. A system in which only a small portion of bank deposits are backed by money is called full reserve banking.
Circle aims to become a full-reserve national commercial bank, regulated by the Federal Reserve, Treasury, OCC, and FDIC. Full reserve banking can lead to a more efficient, safer, and resilient financial system based on digital currency technology.