As the Trump administration continues its pursuit to legitimize crypto, the U.S. stablecoin company preps the groundwork to bridge the gap between decentralized and traditional finance.
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In mid-October inside the International Monetary Fund’s Washington D.C. headquarters, leaders of the IMF, JPMorgan Chase, the World Bank Group and the Monetary Authority of Singapore gathered on stage for the Future of Finance seminar at the IMF-WBG annual meeting.
Sitting amongst them was an unsuspecting addition: the CEO of top stablecoin issuer Circle Internet Group Inc. It was the first time ever that the leader of a cryptocurrency company spoke publicly onstage at an annual IMF-WBG meeting.
“The fact that you’re sitting here in between the president of the World Bank and the IMF tells us something about how much of this is the future of the financial system,” panel moderator and CNBC anchor Sara Eisen told Circle CEO and co-founder Jeremy Allaire.
That recognition is part of the plan for Circle, whose stablecoin USDC is the second-largest dollar-pegged cryptocurrency in volume behind Tether’s USDT and growing faster. After years of chomping on the traditional finance bit, Circle is harnessing momentum following its lionized $1.2 billion initial public offering this summer and a favorable regulatory backdrop to pursue “TradFi” opportunities in order to maintain its stablecoin lead.
“Trump is presiding over an expansion and growth of the industry and sort of a legitimization of it in a regulatory and legal sense,” said Jacob Silverman, a journalist who has written extensively about politics and fraud in crypto. Now, the industry is seeing “growing access to institutional money, Wall Street money and government support, in one way or another.”
Allaire has long pleaded with Congress for stablecoin regulation, maintaining that the passage of pro-stablecoin legislation would pave the way for USDC utilization in the mainstream financial system, allowing Circle to turn banks into its customers rather than its competitors and boost USDC growth. This year, Allaire got what he wanted.
In July, President Donald Trump signed into order the Guiding and Establishing National Innovation for U.S. Stablecoins Act, or the GENIUS Act, one of the first major pieces of crypto legislation in the country that provides a regulatory framework for stablecoins and their issuers.
The Trump administration has also given Circle another case for carpe diem: At the start of his second term, Trump signed executive order “Strengthening American Leadership In Digital Financial Technology” which effectively bans the development of a central bank digital currency in the U.S. A CBDC is essentially a digital dollar issued and regulated by a country’s central bank. With the prospects of a CBDC out of the way, Circle can start vying for dominance in on-chain payment rails and expand its stablecoin market capitalization.
Growth in stablecoin USDC is crucial to Circle’s business model. Circle’s margins rely almost solely on revenue earned from the short-term Treasuries they hold to back USDC’s 1-to-1 dollar peg. The company’s total revenue and reserve income grew 53% year-over-year to $658 million last quarter, but reported a $482 million net loss in the same period (a large chunk of which was attributed to Circle’s IPO costs). Shares of Circle are up 232% from its $31 IPO outperforming the S&P 500 18-to-1.
Circle did not respond to requests for comment for this story.
Unlike traditional non-cash payment, stablecoins running on a blockchain have the ability to clear and settle payments in seconds and are more formally verified. They are also a lot cheaper: compared to fees from clearing houses, credit cards or international wires, stablecoins cost less than 10 cents per transaction.
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“Traditional finance is limited by archaic business hours and multi-day settlement cycles,” said David Krause, emeritus associate professor of finance at Marquette University who regularly reports on crypto. He says USDC “bypasses the friction of the traditional correspondent banking network.”
In mid-August, Circle announced the launch of Arc, a stablecoin-centered blockchain. Arc aims to bring lending, asset issuance, capital markets and payments, among other things, on-chain in a way that’s reliable, fast and compliance-forward which could allow financial institutions to reap the benefits of tokenized money with more protection and security.
Deutsche Bank, BNY, Goldman Sachs, HSBC and BlackRock (which currently manages close to 90% of Circle’s USDC reserves) are just some of the institutions that joined in on Arc trial runs in late October, which allow institutions to test USDC implementation.
In addition to Arc, Circle has said it’s exploring forms of reversible transactions that would allow money to be refunded in the case of fraud or a dispute – a departure from basic principles of crypto. A move like this would make USDC and Arc even more attractive to large institutions whose customers prioritize safety in transactions.
Joining with banks (who have also been experimenting with tokenized deposits of their own, like JPMorgan’s Kinexys) would expand USDC circulation outside of crypto. While big bank collaboration with Circle is still in its infancy, stablecoin transactions in general are growing.
The total addressable market of stablecoins could rapidly expand as banks and Circle make a joint expansion into the tokenized finance space, said Seaport Global analyst Jeff Cantwell.
“It’s not a zero-sum game, necessarily,” said Cantwell. He added, “Bank participation in stablecoins in the future ultimately will prove to be a good thing, both for consumers and for the overall crypto ecosystem.”
It’s unclear what the relationship between banks and Circle will look like in five years, or even in a year’s time. It isn’t even certain that USDC will remain a top competitor.
“This is what’s really difficult to know,” said Baird analyst David Koning.
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But Koning believes that Circle has done enough so far to grow its relationships with financial institutions to grow USDC use. In fact, analysts estimate the company will earn $2.66 billion in revenue this year and jump to $3.27 billion in 2026. They expect a continued net loss of $346 million in 2025 but estimate Circle will turn a profit of $248 million next year.
Dominance is often awarded to early players “who influence standards,” said Lin William Cong, a finance professor and founding faculty director for the FinTech Initiative at Cornell University. He says Circle’s engagement with policy and major financial institutions is “a strategic pre-commitment to legitimacy and infrastructure control.” In other words, the runner in the stablecoin race to do it best – and first – is likely to set the pace.
Sitting onstage next to Allaire at the IMF headquarters, JPMorgan’s global payments co-head Umar Farooq told the audience that the bank’s Fortune 20 customers, even the Fortune 50 ones, just care about the upsides – programmability, 24/7 use, speed, security and low costs — that Circle aims to provide.
Farooq said, “They’re not actually concerned about whether they use stablecoin or commercial bank money or whatever. Whoever provides them the right solution, they will use it.”