Wall Street Giant BNY Bets Bigger on USDC

In Brief

• BNY clients can now hold, mint, redeem, and transfer USDC directly through its custody platform.
• The move expands Circle and BNY's four-year partnership beyond reserve custody into institutional stablecoin services.
• BNY plans to add more stablecoins over time, strengthening the bridge between traditional finance and blockchain.

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BNY clients can now hold, transfer, mint, and burn USDC directly through BNY’s Digital Asset Custody platform, making USDC the first stablecoin supported in this system.

This news is a part of the expanded partnership with Circle meant to provide “new stablecoin enablement capabilities for institutional clients.”

Digital assets are becoming increasingly integrated into financial markets, so “institutions need infrastructure that seamlessly works across traditional and blockchain-based systems,” said Carolyn Weinberg, Chief Product and Innovation Officer at BNY.

‘Direct link between fiat and digital assets’

According to the press release, the launch has widened BNY’s role as primary custodian of USDC reserves.

Its clients can hold USDC in their digital asset custody wallets at BNY. They can also “instruct” Circle through BNY to convert US dollars into USDC and to redeem the stablecoin to USD. It notes that,

“These capabilities support the full lifecycle of institutional stablecoin activity, creating a direct link between fiat and digital asset custody services within a single institutional framework.”

The company also plans to include other stablecoin issuers and digital cash workflows in the future, presumably expanding the stablecoin offering for its clients.

“[M]aking USDC the first stablecoin included in [BNY’s] new offering reflects the regulatory rigor Circle has built into USDC from day one,” said Kash Razzaghi, Chief Commercial Officer at Circle. “This is the next chapter in a longstanding relationship that now gives BNY clients connectivity between onchain and traditional assets, within the infrastructure they already trust.”

Four-year partnership

The relationship between Circle and BNY is well established by now, and it goes back several years. In March 2022, Circle chose BNY as a primary custodian of USDC reserves, which was massive as it meant that the company started safeguarding part of the cash and Treasury assets backing USDC.

For the last four years, BNY remained one of the main institutions holding USDC reserve assets, alongside other major financial partners.

This is significant because BNY is one of the largest custodians in the world, overseeing roughly $59 trillion in assets under custody and administration and serving most major global banks and Fortune 100 companies.

So, while this latest announcement isn’t a brand-new partnership, it’s a noteworthy expansion of a four-year relationship that started with reserve custody and is now evolving into full institutional stablecoin infrastructure.

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