New York Community Bancorp in Westbury has formed a partnership with Circle Internet Financial in Boston where the bank will become a custodian for USD Coin reserves.
The $61 billion-asset New York Community and Circle will collaborate on strategies for using Circle blockchain and stablecoin solutions to promote access to low-cost financial solutions for underserved and unbanked communities.
Circle said in a press release that the move is part of its commitment to allocate a share of USDC dollar-denominated reserves to minority depository institutions (MDIs) and community banks.
“If we want to make the future of money and payments more inclusive than the past, we have to build new partnerships and connections at the community level,” Dante Disparte, Circle’s chief strategy officer and head of global policy, said in the release. “We are opening up new pathways for community banks and MDIs across the country to be key participants in the fast growing digital assets market.”
“We are thrilled that together with being a custodian for USDC reserves, we are also able to partner with Circle on meaningful initiatives to impact inclusion and education to our communities and customers,” Andrew Kaplan, New York Community’s chief digital bank and Banking-as-a-Service officer, said in the release.
The partnership “adds another credible partner into [New York Community’s] stable of blockchain-enabled clients with access to lower-cost funds in relation to traditional CDs,” Chris Marinac, an analyst at Janney Montgomery Scott, wrote in a note to clients.
“We expect the … relationship to further enhance New York Community’s $5 billion in non-CD funds designed under the Banking-as-a-Service umbrella,” Marinac added.
New York Community is pursuing several fintech- and blockchain-related initiatives.
The company is working with Figure Technologies on a series of blockchain projects. It also joined the USDF Consortium, a group formed to mint and use USDF stablecoins.