Circle Launches Arc Blockchain to Boost Stablecoin Efficiency and Scalability

Circle has launched Arc, a new open Layer-1 blockchain specifically designed to enhance the efficiency and scalability of stablecoin-based financial services [1]. This platform will use USDC, Circle’s dollar-pegged stablecoin, as its native gas token, enabling seamless payment of transaction fees and facilitating faster, more secure processing of stablecoin transactions [1]. Arc is intended to serve as a foundational infrastructure for stablecoin-driven payments, foreign exchange, and capital market applications, with a focus on enterprise-grade performance and interoperability [1].

The introduction of Arc aligns with the growing demand for stablecoin infrastructure that can support more complex financial use cases beyond simple peer-to-peer transfers. By embedding USDC into a dedicated Layer-1 solution, Circle is positioning itself to meet the needs of institutional users and developers seeking a reliable and scalable platform for programmable finance and automated settlements [1].

A key design principle of Arc is its emphasis on interoperability and security. The blockchain is being developed as an open-source platform, encouraging community participation and innovation while ensuring compatibility with other partner blockchains [1]. While the exact launch timeline has not been disclosed, Circle plans to begin with a testnet phase in the coming months, allowing for rigorous testing and stakeholder feedback before full deployment [1].

The launch of Arc also reflects the broader trend of stablecoins evolving into a critical element of the global financial infrastructure. As regulatory frameworks continue to develop and market demand for digital assets expands, blockchain platforms like Arc aim to offer a compliant, efficient, and scalable solution that can complement or even replace traditional financial systems [1].

Circle’s Q2 2025 financial performance also highlights the growing importance of USDC in the digital asset ecosystem. The company reported a 53% year-over-year revenue increase, reaching $658 million, underscoring the continued expansion of its stablecoin’s use cases and adoption [1]. Despite Ethereum remaining the largest network for USDC, with a total supply of $42.6 billion, the new Arc blockchain is expected to provide an optimized environment for stablecoin transactions with sub-second settlement times and integrated foreign exchange capabilities [1].

Arc represents a strategic shift in how stablecoins are integrated into blockchain infrastructure, moving beyond generalized platforms toward solutions that are purpose-built for specific financial applications. This tailored approach is expected to reduce inefficiencies in cross-border payments and enhance the overall user experience for both retail and institutional participants [1].

Sources:

[1] Crypto Short News – Latest Real-Time Updates (https://coinpedia.org/crypto-live-news/)

[2] Coinpedia - Fintech & Cryptocurrency News Media| Crypto (https://coinpedia.org/)