Ethereum News Today: Stripe and Circle launch EVM-compatible L1s Tempo and Arc to challenge Ethereum and Solana ecosystems

Stripe and Circle are advancing into blockchain infrastructure with Tempo and Arc, respectively, both EVM-compatible Layer 1 blockchains aimed at payments, stablecoins, and enterprise applications [1]. These developments signal a growing trend of large fintech firms moving beyond third-party chains and building their own infrastructure [1]. Tempo, co-developed with Paradigm and led by former Paradigm co-founder Matt Huang, focuses on high-performance payments and real-time stablecoin settlement [1]. Arc, Circle’s chain, integrates USDC as its native gas token, targeting low-cost, instant cross-border transactions [1].

Both projects highlight a shift in blockchain competition. Ethereum’s stablecoin dominance may be challenged if USDC activity migrates to Arc, and Ethereum’s value capture from gas could diminish as Tempo and Arc reduce reliance on ETH-based gas [1]. For Solana, the absence of Tempo or Arc from its ecosystem weakens its narrative as a unified high-performance chain [1]. If enterprises opt to build their own L1s instead of deploying on existing chains, it could erode Solana’s appeal as a one-stop solution for developers [1].

Despite the potential impact, the success of Tempo and Arc depends heavily on adoption and real-world usage. Stripe has not yet released a testnet for Tempo, and Arc is expected to launch its public testnet in late 2025 with mainnet in 2026 [1]. While these projects could fragment the blockchain landscape, their outcomes remain uncertain. The broader market will likely respond based on whether they deliver practical, scalable solutions for enterprise use.

The rise of enterprise L1s also reflects a broader fintech trend—companies seeking control over their own infrastructure. This contrasts with Solana’s approach of consolidating high-performance use cases on a single chain [1]. Ethereum, though benefiting from EVM compatibility, may not see direct value accrual if these new chains prioritize stablecoins over ETH-centric economics [1]. The long-term impact will depend on how these chains integrate into the broader ecosystem and whether they attract meaningful liquidity and developer activity [1].

Source: [1] Analysis of the Impact of Tempo and Circle Arc L1 Blockchains on the Ethereum and Solana Ecosystems (https://coinmarketcap.com/community/articles/689c3c96af160c7784d135d1/)