Circle Launches Arc Blockchain Amid 90% USDC Growth and $482M Net Loss

Circle, the issuer of the USDC stablecoin, has announced the development of Arc, a new open layer-1 blockchain specifically designed for stablecoin payments, foreign exchange, and capital markets. Arc will utilize USDC as its native gas token, enabling users to pay transaction fees in the stablecoin, aligning with the company’s broader strategy to expand the use of stablecoins in mainstream financial applications. The blockchain is Ethereum Virtual Machine (EVM)-compatible and will offer sub-second settlement finality, optional privacy features, and full integration with Circle’s existing infrastructure [1].

The launch of Arc was announced alongside Circle’s second-quarter 2025 earnings report on August 12, 2025. The company reported that USDC circulation had reached $65.2 billion as of August 10, 2025, representing a 90% increase compared to the same period in 2024. Total revenue and reserve income grew 53% year-over-year to $658 million for the quarter. However, the company posted a net loss of $482 million, primarily due to $591 million in IPO-related non-cash charges [2].

The public testnet for Arc is expected to go live in the fall of 2025. The blockchain will be interoperable with dozens of partner blockchains and will integrate with Circle’s existing platform. It is intended to serve as a foundational layer for stablecoin-based financial activity and will support enterprise-grade use cases such as foreign exchange and cross-chain liquidity [3].

Circle CEO Jeremy Allaire described the development of Arc as a “defining moment” in the company’s mission to build a full-stack platform for the internet financial system. He noted that there is growing interest from the financial industry in building on stablecoins and partnering with Circle [4]. The timing of the announcement is also notable, as it follows the company’s initial public offering in June 2025, which raised $1.2 billion and marked the company’s first quarter as a publicly traded entity. Strategic developments such as the launch of the Circle Payments Network and the early adoption of Circle Gateway for cross-chain liquidity further support the broader ecosystem [5].

The regulatory environment has also been a key factor in the company’s growth. The enactment of the GENIUS Act, which established a federal regulatory framework for payment stablecoins, has reinforced Circle’s position as a regulated stablecoin issuer. This regulatory clarity is expected to support the company’s expansion into traditional finance [6].

Circle’s strategic pivot toward building a proprietary blockchain aligns with its long-term vision of leveraging stablecoins as a bridge between traditional financial systems and decentralized infrastructure. With Arc, the company is positioning itself to capture a growing segment of the market that seeks scalable, secure, and interoperable solutions for stablecoin-based transactions [7].

Source:

[1] Circle Launches Arc Blockchain for Stablecoin Payments (https://coingape.com/usdc-issuer-circle-launches-arc-blockchain-for-stablecoin-payments/)

[2] Circle Announces Stablecoin Payment Blockchain Arc (https://www.benzinga.com/crypto/cryptocurrency/25/08/47054985/circle-announces-stablecoin-payment-blockchain-arc)

[3] Circle Reports Second Quarter 2025 Results (https://www.businesswire.com/news/home/20250812836620/en/Circle-Reports-Second-Quarter-2025-Results)

[4] Circle reports $482 million loss despite 53% revenue growth in Q2 (https://www.streetinsider.com/Corporate+News/Circle+reports+%24482+million+loss+despite+53%25+revenue+growth+in+Q2/25183722.html)

[5] Circle announces new blockchain amid blockbuster earnings (https://www.thestreet.com/crypto/markets/circle-announces-new-blockchain-amid-blockbuster-earnings)

[7] USDC Issuer Circle Introduces New Layer-1 Blockchain Arc (https://cointelegraph.com/news/usdc-issuer-circle-layer-1-blockchain-arc)