BNY has added USDC minting, redemption, custody and transfer services to its Digital Asset Custody platform, giving institutional clients direct access to Circle’s stablecoin through the bank.
Summary
- BNY has enabled institutional clients to mint, redeem, store and transfer USDC directly through its Digital Asset Custody platform.
- The bank has expanded its role with Circle beyond safeguarding USDC reserves by adding client-facing stablecoin services.
- BNY joins Invesco, JPMorgan and State Street as major financial institutions rolling out products tied to stablecoin reserves and infrastructure.
According to BNY, the update allows clients to turn U.S. dollars into USDC and redeem the stablecoin back into dollars from within its platform. The bank said clients can also hold and transfer USDC through its digital asset custody service, making Circle’s token the first stablecoin supported by the platform.
The service deepens BNY’s existing relationship with Circle. BNY already serves as the primary custodian for the assets backing USDC, and the latest expansion moves the bank beyond reserve custody into direct stablecoin services for institutional clients.
BNY said it plans to add support for more stablecoins and digital cash workflows over time. The bank did not name the next assets it may support or give a timeline for the expansion.
BNY is taking USDC deeper into institutional custody
BNY said it oversees $59.3 trillion in assets under custody and administration and serves more than 90% of Fortune 100 companies. Its USDC support gives large institutions a bank-based route to access stablecoin issuance and redemption without moving outside a regulated custody environment.
USDC is the second-largest stablecoin by market value, with more than $73.8 billion in circulation, according to DefiLlama data. Tether’s USDT remains the largest stablecoin, while DefiLlama data places the total stablecoin market at about $313 billion.
The announcement also follows BNY’s recent work in other areas of digital asset custody. In May, the bank partnered with Abu Dhabi-based Finstreet and the ADI Foundation to develop institutional custody services for Bitcoin and Ether, with plans to later include stablecoins and tokenized real-world assets.
By adding USDC minting and redemption to its platform, BNY is placing stablecoin activity closer to the custody and settlement systems already used by institutional clients. Circle’s role remains tied to USDC issuance, while BNY’s expanded service gives clients custody and movement tools around the token.
Banks are building products for stablecoin reserves
BNY’s move comes as large financial firms develop products tied to stablecoins, reserve assets and tokenized cash management.
Last week, Invesco filed with the U.S. Securities and Exchange Commission to launch a tokenized money market fund for stablecoin reserve management. According to the filing, the fund would invest in cash and short-term U.S. Treasury securities.
In May, JPMorgan filed to launch a tokenized money market fund designed for stablecoin issuers. The Ethereum-based fund would invest in U.S. Treasury bills and overnight repurchase agreements used to back payment stablecoins.
State Street also launched a government money market fund for stablecoin issuers earlier this month. The fund invests in U.S. government securities and repurchase agreements, with State Street Bank and Anchorage Digital listed among its first investors.
Other financial firms have also moved into stablecoin-related services. In January, Fidelity Investments launched its U.S. dollar-backed stablecoin FIDD after receiving conditional approval to operate a national trust bank.
Together, the announcements show how major banks and asset managers are building around the reserve, custody and payment layers of stablecoins as institutional demand for digital cash infrastructure grows.
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