Citizens Trust Bank, a financial institution that is regulated by the Federal Deposit Insurance Corporation (FDIC), has partnered with Circle Internet Financial to hold some of its reserves in USD Coin (USDC). The move, which the companies said would promote financial inclusion and digital literacy in the greater Atlanta area, was announced earlier this week.
As part of a bigger partnership between the two firms, Circle announced on the 24th of February that the Atlanta-based Citizens Trust Bank will hold $65 million in USDC reserves. This partnership is part of a larger cooperation between the two organizations. Small firms will have access to finance thanks to the bank’s USDC reserves, and those reserves will also be utilised for other projects aimed at expanding financial inclusion. According to Cynthia N. Day, president and chief executive officer of Citizens Trust, owning USDC would also help enhance the bank’s balance sheet.
The Federal Deposit Insurance Corporation (FDIC) has designated Citizens Trust Bank as a minority-owned depository institution (MDI), which indicates that minority people make up the majority of either the bank’s voting shares or its board of directors. In 1947, the bank became a member of the Federal Reserve System.
The bank was able to attract an additional $220 million in deposits during the years 2020 and 2021. The most recent year for which information is readily accessible to the public is 2021, and during that year Citizens provided funding for business, consumer, and residential mortgage loans totaling 157 million dollars.
More users are depending on dollar-pegged assets to hold collateral, trade cryptocurrency, and generate income, which has led to the growth of stablecoin settlements in lockstep with the explosion in decentralized finance that has occurred over the last two years. Despite this, the use of stablecoins for payments is still relatively uncommon because of regulatory hurdles.