Company: CRCL
Filing Date: 2025-08-04
Form Type: DRS
Source: 0000950123-25-006942
Chunk: 238

Company: Circle Internet Group, Inc.
Filing Date: 2025-08-04
Form: DRS
Chunk 238
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 strict fiduciary obligations and limits investments of reserves to specific categories of investments; and examination by state and
federal regulatory agencies. Under the regulations governing our MTLs, we must hold assets that underly our outstanding money transmission obligations (i.e., reserve assets that underlie Circle stablecoins), for the benefit of holders of Circle
stablecoins and are prohibited from lending, pledging, rehypothecating, or otherwise encumbering reserve assets. In addition, under the regulations governing our MTLs, except in limited circumstances, such as when prohibited by law or court order or
instances where fraud is suspected, we are required to honor outstanding stored value and payment instrument obligations of customers (i.e., we are required to honor redemption requests by Circle Mint customers) even if reserve assets and the
proceeds from reserve assets are insufficient to do so. In such situations, we must use our corporate funds and resources to satisfy any shortfall.

In
addition, Circle Internet Financial, LLC was the first company approved for a BitLicense by the NYDFS, which is required for any person that engages in virtual currency business activity in New York or with New York customers. The BitLicense enables
Circle Internet Financial, LLC to engage in virtual currency exchanging and trading services, electronic money transmitting with virtual currencies, issuing prepaid access/stored value with virtual currencies, and selling prepaid access/stored value
with virtual currencies. Circle Internet Financial, LLC also holds a Virtual Currency License from the Louisiana Office of Financial Institutions, which, like the BitLicense issued by the NYDFS, is required for any person that engages in virtual
currency business activity in Louisiana or with Louisiana customers. These licenses impose additional requirements on how we maintain the Circle stablecoin reserves. For example, regulations governing the BitLicense and related NYDFS guidance
require, among other things, that (i) stablecoins must be fully backed by reserve assets, (ii) reserves must be available for timely redemptions, (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