Circle Launches Arc Blockchain to Boost Stablecoin Transactions and Cross-Border Payments

Circle has officially launched Arc, an open-source Layer-1 blockchain designed to power global stablecoin transactions and cross-border payments. The network is fully compatible with the Ethereum Virtual Machine and uses USDC as its native gas token, allowing users to pay transaction fees directly in stablecoin without the need for token conversion [1]. This integration aims to streamline operations, reduce volatility-related inefficiencies, and provide a more predictable cost structure for both individuals and enterprises [2].

Arc is engineered to address common limitations in existing blockchain platforms—particularly those related to speed, scalability, and settlement finality. The network offers sub-second finality and is optimized to handle large transaction volumes with low latency, making it ideal for use cases such as international remittances, trade settlements, and tokenized financial assets [3]. Additionally, the platform includes an integrated FX engine and opt-in privacy features, which are intended to enhance the efficiency and security of global financial flows [4].

The launch of Arc represents a strategic shift for Circle, expanding its role from a stablecoin issuer to a key infrastructure provider in the digital asset ecosystem. By creating a blockchain tailored for stablecoin finance, Circle is addressing the need for a more efficient and compliant infrastructure that can support the growing demand for stablecoin-based transactions [5]. This move also aligns with broader industry trends, as major players increasingly explore Layer-1 solutions to accommodate the unique needs of stablecoin activity [6].

Circle emphasized that Arc is being developed to meet the standards of regulated financial environments. The platform includes built-in compliance tools, which support institutional-grade operations and facilitate seamless integration with existing financial systems [7]. These features are expected to attract enterprises and financial institutions looking for a scalable, compliant framework for stablecoin-based transactions.

The launch of Arc coincided with Circle’s recent financial performance highlights. The company reported a 90% year-over-year increase in USDC circulation, reaching $61.3 billion during Q2 2025, and $65.2 billion by August 10 [8]. Revenue and reserve income rose 53% year-over-year to $658 million, with adjusted EBITDA increasing by 52% to $126 million [9]. Following the Senate’s approval of the GENIUS Act, which provides a federal framework for stablecoin regulation, Circle’s stock rose nearly 34% [10].

To enable further development and testing, Circle plans to launch a public testnet for Arc later in 2025. This phase will allow developers and enterprises to begin building on the platform and exploring its potential applications [11]. The company also confirmed that Arc will remain interoperable with other blockchains that support USDC, ensuring flexibility and broader adoption across the ecosystem [12].

Sources:

[1] https://www.circle.com/blog/introducing-arc-an-open-layer-1-blockchain-purpose-built-for-stablecoin-finance

[2] https://blockonomi.com/circle-launches-arc-blockchain-to-power-global-stablecoin-transactions/

[3] https://www.blocmates.com/news-posts/circle-announces-arc-blockchain-launch-with-usdc-as-native-gas

[4] https://www.ainvest.com/news/circle-launches-arc-blockchain-boost-stablecoin-enterprise-2508/

[5] https://www.pymnts.com/earnings/2025/circle-usdc-volume-hits-6-trillion-dollars-race-first-mover-advantage/

[6] https://thedefiant.io/stripe--circle-join-l1-parade

[7] https://www.digitaltransactions.net/stablecoin-giant-circle-launches-arc-for-cross-border-flows/

[8] https://www.reuters.com/business/stablecoin-issuer-circle-tops-revenue-estimate-first-quarterly-result-since-ipo-2025-08-12/

[10] https://markets.chroniclejournal.com/chroniclejournal/article/marketminute-2025-8-12-circle-internet-group-pioneering-the-digital-dollar-revolution