The Bank of New York Mellon has expanded its partnership with Circle to give institutional clients direct access to minting and redeeming the USDC stablecoin through its digital custody platform. Clients can now hold USDC in BNY wallets and convert between U.S. dollars and the token within the bank’s own infrastructure.
USDC becomes the first digital asset integrated into BNY Mellon’s digital asset custody platform. The bank already acts as a custodian for USDC reserves, and this move connects traditional cash management with blockchain-based settlement in a single system.
Direct access removes need for intermediaries
Clients will be able to custody, transfer, and manage the full lifecycle of USDC without relying on third parties. Minting allows new USDC to be issued against dollar deposits, while burning enables redemption back into fiat on demand. By bringing these processes in-house, BNY Mellon aims to streamline operations and reduce friction for traders using stablecoins.
The bank said it plans to add more stablecoin issuers over time, signaling broader ambitions in digital asset services as demand for tokenized financial tools grows.
Expansion follows broader digital asset push
BNY Mellon, the world’s largest custodian, has been steadily building its presence in digital assets. Earlier this year, it launched a tokenized deposit service used by several institutions, including ICE and Citadel Securities. It also supports custody for regulated products such as spot bitcoin and ether ETFs.
Regulatory backdrop supports stablecoin growth
The move comes as U.S. regulators push for clearer oversight of stablecoins. Recent proposals from the Federal Reserve aim to apply bank-level anti-money laundering rules to issuers, while the GENIUS Act framework is shaping how financial institutions can issue and use dollar-backed tokens.
The stablecoin market has grown rapidly, reaching about $316 billion in total value by late June 2026. USD-backed tokens account for roughly 97% of that figure. USDC alone has a market capitalization near $73.77 billion, with daily trading volumes typically ranging from $9 billion to $15 billion.
Closer ties between banks and blockchain
BNY Mellon’s integration highlights a deeper alignment between traditional finance and blockchain systems. By enabling direct conversion between dollars and USDC within a regulated banking environment, the bank is lowering barriers for large-scale capital to move on-chain.
This shift could influence how liquidity and risk are distributed across digital asset markets, particularly favoring assets with strong regulatory alignment. The move also reflects a broader trend, as major financial institutions continue building infrastructure that connects conventional finance with blockchain-based networks.
Want to explore USDC and stablecoins further? Read this stablecoin insights guide for deeper institutional adoption context.
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