Circle registering for a banking license

Crypto trading platform Circle is hoping to gain a banking license in the U.S.

The startup is seeking to register as a federally licensed bank within the United States, according to Bloomberg.

Bloomberg states in a report published Wednesday, that Circle also plans on registering with the SEC (Securities and Exchange Commission) as a brokerage and trading platform.

Circle currently offers a crypto wallet and investing platform, as well as an OTC digital assets trading service.

By obtaining a banking license, the move would make Circle the first of its kind.

If successful, the move by the Goldman Sachs-backed firm would allow it to legally offer a trading service for crypto tokens that are currently considered securities in the United States.

A banking license would also help Circle avoid the complexities of having to register as a cryptocurrency firm with regulators in all fifty states.

Robert Bench, Circle’s chief compliance officer, explains to Bloomberg:

“You’re able to have a single conversation.

“It’s hard to have 50 conversations.”

Circle says it is still in early talks with the Office of the Comptroller of the Currency over the banking registration, the SEC and the Financial Industry Regulatory Authority.

According to the reports, the firm says it will likely seek SEC regulation before applying for the banking license, however.

During an interview with Bloomberg, Circle’s CEO, Jeremy Allaire said:

“To hold reserves with the Federal Reserve, to directly settle with other banks in other markets around the world through those networks – that can improve the efficiency of what we deliver.

“it can reduce the costs.”

As Wall Street bigwigs begin moving into the cryptocurrency space, regulators would have the opportunity to use Circle to explore regulatory frameworks, explains Allaire.

The move by Circle would certainly boost their position as cryptocurrency platform.

The firm announced in October last year that it hopes to offer a wide range of digital assets for trading.

The ambitious move would seem to align well with Circle’s notable aim, as reported by CoinDesk in October 2017, to eventually offer a wide range of digital assets.

Speaking at the time, Allaire said:

“I think what we would be comfortable saying is that digital assets – which are not just digital currencies, but a broader range of assets – it’s an area that has grown a lot, but that’s not easily accessible to mainstream investors,”

In February this year, Circle acquired Poloniex exchange in a move tipped to put the firm into compettion with leading US platform, Coinbase.

At the time, sources claim that the firm invested roughly $400 million for the deal.