Circle Launches Arc Blockchain to Power Stablecoin Finance with USDC as Native Gas

Circle, the issuer of USD Coin (USDC), has announced the development of Arc, a new Ethereum Virtual Machine (EVM)-compatible Layer-1 (L1) blockchain designed specifically for stablecoin finance. The network will use USDC as its native gas token, enabling users to pay transaction fees in the stablecoin. This development marks a key step in Circle’s vision to build a full-stack internet financial platform, according to the company [1][2]. The blockchain will include an integrated stablecoin foreign exchange (FX) engine, sub-second settlement finality, and optional privacy controls. It is intended to support stablecoin-based payments, FX, and capital market applications. Arc is scheduled for a public testnet launch later this year and will be fully interoperable with Circle’s existing platform and partner blockchains [3].

The announcement comes alongside Circle’s Q2 2025 financial results, which revealed a 53% increase in total revenue to $658 million. As of August 10, 2025, the circulation of USDC had grown to $65.2 billion, up 90% year-over-year. Despite this revenue growth, the company reported a net loss of $482 million, primarily attributed to non-cash charges from its June 2024 initial public offering (IPO), which raised $1.2 billion through the sale of 19.9 million shares [4][5].

Circle’s CEO, Jeremy Allaire, described the launch of Arc as a “defining moment” in the company’s mission to develop a global internet financial system. By leveraging USDC as the native gas token and embedding FX functionality into the blockchain, Circle aims to provide a compliant, efficient, and scalable environment for enterprises and institutions. The platform is expected to accelerate the shift toward a stablecoin-powered global economy [6].

Circle also announced plans to expand the use of USDC through partnerships with financial institutions and payment processors. Over 100 institutions are currently in the onboarding pipeline, including Binance, Corpay, FIS, Fiserv, and OKX. These collaborations aim to integrate USDC into global payment flows, cross-border transactions, and capital market infrastructure [7].

In addition, Circle has partnered with Hyperliquid, a decentralized finance trading platform, to launch its native USDC and Cross-Chain Transfer Protocol (CCTP) V2. Hyperliquid’s total assets under management have recently exceeded $5.5 billion, highlighting the increasing adoption of stablecoin-based infrastructure [8].

Circle now joins a growing list of companies developing their own blockchains, including Kraken’s Ink, Coinbase’s Base, and Binance’s BNB Chain. The choice to build a Layer-1 network instead of a Layer-2 solution differentiates Circle from some competitors and positions Arc as a core infrastructure layer for stablecoin-based financial applications. The company emphasized that Arc will be deeply integrated into its platform while remaining interoperable with other blockchains [1][3].

Source: [1] https://www.theblock.co/post/366540/circle-stablecoin-focused-evm-compatible-layer-1-blockchain-arc

[2] https://www.coindesk.com/business/2025/08/12/circle-unveils-layer-1-blockchain-arc-reports-usd428-million-q2-loss

[3] https://cointelegraph.com/news/usdc-issuer-circle-layer-1-blockchain-arc

[4] https://www.msn.com/en-us/money/markets/circle-posts-53-revenue-jump-unveils-arc-blockchain-for-next-gen-stablecoin-payments/ar-AA1KnoqB?ocid=finance-verthp-feeds

[5] https://www.ainvest.com/news/circle-launches-arc-blockchain-power-usdc-based-financial-infrastructure-2508/

[6] https://cryptonews.com/news/circle-launches-arc-blockchain-for-stablecoin-payments-with-usdc-as-native-gas/

[7] https://www.c-sharpcorner.com/news/circle-launches-arc-blockchain-for-stablecoin