Circle Launches Circle Payment Network

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Introduction

Welcome to the Tokenized newsletter, brought to you by the creators of the Tokenized Podcast; Simon Taylor of Fintech Brainfood and Pet Berisha of Sporting Crypto, written by Jeremy Batchelder.

We are the newsletter for institutions that need help preparing for a Tokenized future.

We run through the headlines every week, what it means for you and a market readout. Always with an institutional, business-focused perspective. 

Join us every week as we meet your Tokenization needs.

Things to Know 👀 

🚀 Circle Launches Circle Payments Network (CPN) for Global Money Movement

Circle has launched its new Circle Payments Network (CPN) designed to transform how financial institutions facilitate cross-border payments using stablecoins. This marks a strategic evolution for the USDC issuer, expanding beyond stablecoin issuance to become a network operator that orchestrates global money movement.

Key Points:

• CPN brings financial institutions together in a compliant framework to orchestrate global payments in fiat, USDC, EURC, and other payment stablecoins

• The network acts as a marketplace connecting Originating Financial Institutions (OFIs) with Beneficiary Financial Institutions (BFIs) across borders

• CPN establishes strict eligibility standards for financial institutions, requiring proper licensing and AML/CFT compliance

• Settlement occurs using regulated stablecoins (initially USDC and EURC) across multiple blockchain networks

• The platform includes intelligent FX discovery, cross-chain settlement capabilities, and confidentiality features

The Tokenized Take:

• Strategic business model pivot: This represents a crucial shift in Circle's strategy from being solely a stablecoin issuer to becoming a network operator with a recurring transaction fee revenue stream, diversifying beyond interest earned on USDC reserves.

• Institutional infrastructure layer: By establishing governance standards and technical infrastructure for financial institutions, Circle is positioning itself at the center of institutional stablecoin adoption rather than merely providing the tokens.

• Global liquidity aggregation: CPN aims to solve fragmentation issues by creating a unified marketplace where financial institutions can discover counterparties, access pricing, and facilitate movement between fiat currencies and stablecoins.

• Interoperability strategy: Although initially focused on USDC and EURC, the network's architecture allows for expansion to other stablecoins that meet governance and eligibility standards, potentially positioning Circle as the dominant infrastructure layer.

💸 Crypto Firms Make Banking Moves as Trump Administration Embraces Digital Assets

The Wall Street Journal reported that crypto companies are pursuing banking charters and licenses as the regulatory landscape shifts under the new Trump administration, setting the stage for deeper integration between digital assets and traditional finance systems.

Key Points:

• Circle (USDC issuer) and BitGo are planning to apply for bank charters or licenses, according to people familiar with the matter

• Coinbase and Paxos are considering similar moves as they position themselves for regulatory changes

• The Trump administration is actively working to incorporate crypto into mainstream finance

• Two bills advancing in Congress would establish a regulatory framework for stablecoins, requiring issuers to have charters or licenses

• The Trump family's World Liberty Financial is planning to launch a USD1 stablecoin with BitGo safeguarding reserves

The Tokenized Take:

• Strategic repositioning: The push for banking charters signals a fundamental shift in how crypto companies view their role in the financial ecosystem - moving from operating adjacent to banks to becoming regulated financial institutions themselves.

• Regulatory pivot: Chairman Jerome Powell signaled a potential "loosening" of crypto-related rules for banks, noting that while there had been "a wave of failures and fraud" in crypto's past, the atmosphere is "turning more mainstream"

Stablecorner ⚖️ → The Two Competing Paths for Tokenized Money

The stablecoin ecosystem is evolving into two distinct but potentially converging infrastructure models, each serving different market needs but together driving massive growth in the tokenized dollar space.

As financial institutions position themselves in this landscape, we're seeing a clear bifurcation in approaches:

1. Closed-loop tokenized deposits - JPMorgan's Kinexis (formerly Onyx/JPM Coin) exemplifies this model, having processed over $1.5 trillion in cumulative transactions and now averaging more than $2 billion daily. This infrastructure enables 24/7 multi-currency settlement between the bank's clients, recently expanding from USD and EUR to now include GBP capabilities, with the London Stock Exchange Group and commodities trader Trafigura as early adopters. This model optimizes for intra-bank efficiency but remains within the controlled ecosystem of a single financial institution.

2. Open-loop stablecoins - These blockchain-native assets provide global, permissionless dollar access beyond traditional banking systems. With current transaction volumes potentially reaching $6 trillion annually (after adjusting for high-frequency trading), they serve diverse use cases from cross-border payments to trading. Standard Chartered predicts this segment could grow from today's $230 billion to approximately $2 trillion by 2028, representing about 10% of the US M2 money supply.

The critical question for the market is whether these approaches will remain separate products serving different use cases or eventually converge. As Cuy Sheffield of Visa noted in a recent discussion, "Do tokenized deposits directly interact with stablecoins? Will these be developed in parallel? Will they intersect or cross over at some point in the future?"

For institutions entering this space, the answer will determine strategic positioning. Banks like Standard Chartered that have been building crypto capabilities for years now have compounding advantages as regulatory clarity improves. Meanwhile, money center banks like JPMorgan, HSBC, and Citi are developing their own tokenized deposit solutions, recognizing that the future of financial infrastructure will involve some form of tokenization.

📰 Some More News:

🏦 Tokenization, Stablecoins & Finance

• Circle Launch Refund Protocol (Read more)

• Bleap partners with Mastercard to scale stablecoins (Read more here)

• Charles Schwab CEO says spot crypto trading will 'likely' launch within 12 months (Read more here)

• Ripple backs new XRP Tracker Fund by HashKey Capital, signaling institutional push in Asia (Read more here)

• VanEck aims to launch crypto-related investments ETF next month (Read more here)

• Solayer launches crypto rewards Visa card (Read more here)

🤑 Funding

• Tokenization firm Securitise acquires MG Stover’s fund admin service (Read more here)

• Neutrl Raises $5M to Tokenize a Popular Hedge Fund Altcoin Trade (Read more here)

• Resolv Labs Raises $10M as Crypto Investor Appetite for Yield-Bearing Stablecoins Soars (Read more here)

• Kado Software Acquired by Swapped[dot]com (Read more here)

• A16z purchase $55m ZRO (LayerZero) (read more here)

💼 Government & Policy

• South Korea's central bank vows to 'actively participate' in stablecoin legislation development (Read more here)

• BIS report calls for 'containment' of crypto risks as TradFi connections deepen, sparking criticism (Read more here)

Simon’s Market Readout 💬 

Tweet of the Week 🐤 

From Atikh, CEO of Acctual

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