Sei Warns USDC.n Token Holders to Swap for 'Native' Stablecoin Ahead of Planned Upgrade

Crypto project Sei has issued a notice to holders of the USDC.n stablecoin, urging them to swap for the native USDC token before a major network upgrade in March 2026. The upgrade, known as SIP-3, will mark a shift to an EVM-only chain and phase out support for CosmWasm and Cosmos-native assets according to Sei's announcement.

The USDC.n token, also known as USDC via Noble, was the primary stablecoin on the Sei Network before Circle launched a native version. It was originally issued on the Noble blockchain and bridged to Sei as reported. As users continue to migrate to the native USDC, the value of USDC.n on Sei is expected to decline significantly.

Sei has recommended several methods for converting USDC.n. Smaller volume holders are advised to use DragonSwap or Symphony for conversions, while larger holders are directed to use Brr, a tool that batches transactions from Noble to Polygon and back to the Sei Network using Circle's CCTP as detailed.

Why Did This Happen?

Sei's decision to transition to an EVM-only chain is part of a broader strategy to align with industry standards and improve compatibility with Ethereum-based protocols. The SIP-3 upgrade will deprecate CosmWasm and Cosmos-native assets, which means that any token not compatible with the EVM will become inaccessible on the Sei Network according to technical documentation.

This transition is expected to streamline smart contract development and reduce complexity for developers and users. It also reflects the increasing dominance of EVM-based networks in the blockchain space, which has driven interoperability and adoption as industry analysis shows.

How Markets Responded

The announcement has prompted immediate action among token holders, with several million dollars in USDC.n already being converted to native USDC. The current value of USDC.n on Sei has declined to around $1.4 million, down from a higher value a few months ago according to market data.

Investors and analysts are also paying attention to the implications for the broader stablecoin market. The transition underscores the importance of maintaining token liquidity and interoperability across different blockchain ecosystems as experts note.

What Are Analysts Watching Next?

Analysts are closely monitoring how the migration affects Sei's user base and network activity. The success of the upgrade will depend on how smoothly users can convert their tokens and how well the new EVM-only architecture performs according to industry forecasts.

Another key area of interest is the role of Circle and Noble in the broader Cosmos ecosystem. Circle Ventures invested in Sei in late 2023, and the partnership with Noble has positioned the Sei Network as a key deployment hub for USDC in the Cosmos-verse as reported by industry sources.

Investors are also watching whether other projects will follow a similar path of transitioning to EVM-only chains, given the potential for increased interoperability and developer adoption according to market analysis.