Company: CRCL
Filing Date: 2025-02-13
Form Type: DRS/A
Source: 0000950123-25-001965
Chunk: 217

Company: Circle Internet Group, Inc.
Filing Date: 2025-02-13
Form: DRS/A
Chunk 217
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 which is required for engaging as

145

CONFIDENTIAL TREATMENT REQUESTED BY CIRCLE INTERNET GROUP, INC. PURSUANT TO 17 C.F.R. § 200.83

a business in money transmission services. These licenses and registrations subject us
to, among other things, recordkeeping and reporting requirements; capital and bonding requirements; obligations to develop, implement, and maintain risk-based AML and CFT programs; customer due diligence requirements; limitations on the investment
of customer funds, including 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 underly 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 (i.e., Circle stablecoins) of customers (i.e., we are required to honor redemptions 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 requires, among other things, that (i) stablecoins must be fully backed by
reserve assets, (ii) reserves must be available for timely redem