Circle Internet Financial has revealed a USD coin custody partnership with U.S. bank holding company New York Community Bank (NYCB). Under the agreement, New York Community Bank, a subsidiary of NYCB, will be the custodian of the company’s stablecoin reserves.
Circle partners with New York Community Bank
On Tuesday, Circle announced a partnership with NYCB, the parent company of the National Association of American Banks. According to the announcement, the New York Community Bank, a subsidiary of the NYCB, will host reserves for Circle’s popular stablecoin USD Coin (USDC).
USDC is the second largest stablecoin today with a market cap of $53.9 billion. In the past 24 hours, Circle’s USDC stablecoin has reached $5 billion in global trading volume. New York Community Bank will also partner with Circle to provide low-cost financial solutions to unbanked communities.
The strategies of the two companies will utilize blockchain solutions and stablecoin systems. Solutions include allocating USDC dollar-denominated reserves to the Minority Depository Institution Initiative (MDI) and community banks. Dante Disparte, chief strategy officer and head of global policy at Circle, explained that the future of money will be more inclusive.
“If we want to make the future of money and payments more inclusive than the past, we must forge new partnerships and connections at the community level,” Disparte said in a statement.
Circle’s chief strategy officer added:
By partnering with the NYCB, we are opening new avenues for community banks and MDIs across the country to become major players in the fast-growing digital asset market.
Circle wants to improve financial inclusion – BlackRock and BNY Mellon also handle USDC’s reserve management and custody services
On November 17, 2021, Disparte wrote a blog post explaining that Circle wanted to “[improve] Financial inclusion and economic prosperity for all. The post discusses collaborations with community banks and MDI, and the concept of “promoting global economic prosperity through the frictionless exchange of financial value.”
The partnership with NYCB comes after Moneygram launched its USDC cryptocurrency program in select markets. Additionally, Circle recently launched USDC on the Polygon blockchain network and issued a second major stablecoin backed 1:1 with the euro.
Andrew Kaplan, executive vice president and chief digital banking and banking-as-a-service officer at NYCB, said the financial institution is “proud to be the leading digital asset innovator among U.S. banks.”
“We are delighted that, as custodians of the USDC reserve, we are also able to partner with Circle on meaningful initiatives to impact inclusivity and education for our community and customers,” Kaplan concluded.
In addition to NYCB, financial giants Blackrock and BNY Mellon have also partnered with Circle. BlackRock was named “the primary asset manager of USDC’s cash reserves,” and the oldest U.S. investment bank, Bank of New York Mellon, was also disclosed as the USDC custodian last April.
What do you think of Circle’s partnership with NYCB? Let us know what you think about this topic in the comments section below.
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