Circle Launches Arc Blockchain to Boost Stablecoin Finance After 90% USDC Growth and $482M Loss

Circle, the New York-based digital currency firm, has announced the launch of Arc, a Layer 1 blockchain specifically engineered for stablecoin finance, marking a significant step in the evolution of digital assets. Arc is designed to optimize stablecoin payments, foreign exchange, and capital markets operations. The blockchain is EVM-compatible and enterprise-grade, featuring USDC as its native gas token and a built-in stablecoin FX engine to facilitate efficient and compliant global transactions. The platform is set to offer sub-second settlement finality and opt-in privacy controls, with seamless integration into Circle’s existing infrastructure [2].

The project was revealed as part of Circle’s second-quarter earnings report, which highlighted a 90% year-over-year increase in USDC circulation, surpassing $61 billion. Total revenue and reserve income for the quarter rose 53% to $658 million. However, the company reported a net loss of $482 million, largely due to non-cash charges from its IPO, which totaled $591 million. In a statement, Jeremy Allaire, co-founder and CEO of Circle, described the June IPO as a pivotal moment for the company and for the broader adoption of stablecoins [3].

Arc represents a strategic pivot by Circle to develop infrastructure that supports the next phase of internet-based financial systems. By addressing challenges such as interoperability and settlement efficiency, the blockchain aims to expand the utility of stablecoins beyond basic remittances into more sophisticated financial services. This initiative aligns with an industry-wide shift to integrate digital assets into mainstream finance [4].

The public testnet for Arc is scheduled to launch this fall, allowing developers and partners to begin testing and building on the platform. This phase will be critical in demonstrating the blockchain’s capabilities and preparing for broader adoption. By providing a dedicated blockchain tailored for stablecoin use cases, Circle aims to reduce friction in cross-border payments and enhance the efficiency of global capital markets [5].