Company: CRCL
Filing Date: 2025-02-13
Form Type: DRS/A
Source: 0000950123-25-001965
Chunk: 218

Company: Circle Internet Group, Inc.
Filing Date: 2025-02-13
Form: DRS/A
Chunk 218
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ptions, (iii) reserves must be segregated from the proprietary assets of the issuer and held in custody for the benefit of holders of Circle stablecoins with U.S. state or federally
chartered depository institutions with deposits insured by the FDIC and/or asset custodians approved in advance by the NYDFS, (iv) reserves must be limited to specified assets such as U.S. Treasury bills with maturities of three months or less,
reverse repurchase agreements fully collateralized by U.S. Treasury obligations, government money market funds, and deposit accounts at U.S. state or federally chartered depository institutions, and (v) reserves must be attested to monthly and
annually by a certified public accountant. In addition, regulations governing the BitLicense as well as regulations governing our Virtual Currency License prohibit us from lending, pledging, rehypothecating, or otherwise encumbering reserve assets.
Other jurisdictions are expected to require similar licenses. For example, California’s Digital Financial Assets law will require persons engaging in digital asset business activities to obtain a license from the California Department of
Financial Protection and Innovation when the law comes into effect on July 1, 2025.

While our MTLs and money services business registration status subject us
to regulations that govern material aspects of our business—for example, how we commercialize Circle stablecoins, onboard customers, and maintain adequate reserves to fully back Circle stablecoins—such regulation is not equivalent to the
type of prudential regulation and supervision that applies to regulated banks, such as under the Federal Deposit Insurance Act, National Bank Act, Bank Holding Company Act, and the Federal Reserve Act, which include prudential supervision by
regulators, minimum capital requirements, and specified prohibited activities.

Commodities and securities laws

The CFTC has stated in guidance and before Congress, and federal case law relating to CFTC enforcement actions have supported, that at least some digital assets,
including Bitcoin, Ether, and certain stablecoins, fall

146

CONFIDENTIAL TREATMENT REQUESTED BY CIRCLE INTERNET GROUP, INC. PURSUANT TO 17 C.F.R. § 200.83 within the definition of a “commodity” under the Commodity Exchange Act (the “CEA”) and the regulations of the CFTC thereunder. In particular, on October 12, 2023, the CFTC expressly stated in a complaint against a third party that USDC is a “commodity” as defined in the C