Circle, the issuer behind USD Coin (USDC), has launched its proprietary blockchain network, Arc, directly to mainnet. The network introduces an execution environment where transaction fees are denominated and settled exclusively in USDC, eliminating the operational friction of purchasing and managing volatile native assets for gas fees.
Why did Circle eliminate volatile gas tokens on Arc?
For institutional enterprises and commercial payment providers, protocol-level gas volatility has long served as an impediment to onchain adoption. Conventional Layer 1 and Layer 2 ecosystems require corporate treasuries to maintain secondary token inventories—such as ETH, SOL, or AVAX—simply to execute dollar-denominated settlement transactions. This dynamic creates balance sheet tracking complexities, working capital inefficiencies, and tax reporting overhead under standard corporate accounting frameworks.
By integrating USDC as the protocol’s sovereign gas accounting unit, Arc consolidates execution costs into the same stable value medium used for transaction settlement. Corporate treasurers can forecast transaction budgets in fiat terms, reconcile expenses against standard GAAP/IFRS principles, and avoid constant balance rebalancing between operational tokens and base liquidity.
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Expanding on its institutional capital architecture, Circle has launched a Bitcoin-backed USDC borrowing program tailored specifically for institutional clients. Under the new facility, eligible counterparties can post Bitcoin (BTC) as collateral to borrow USDC directly from Circle, unlocking dollar liquidity without liquidating underlying digital asset reserves.
The credit product directly complements the operational efficiencies established by the Arc mainnet. Institutional market makers, asset managers, and corporate treasuries can now pledge spot BTC reserves to secure working capital in USDC, deploy that capital across onchain liquidity rails, and settle transactions on Arc without holding third-party gas assets.
“Circle’s concurrent expansion into Bitcoin-collateralized lending and single-token gas settlement bridges the gap between institutional credit facilities and onchain execution,” said Marcus Vance, Managing Director of Digital Asset Strategy at Bastion Capital. “By allowing treasuries to unlock liquidity against their BTC while running enterprise payments entirely within a dollar-denominated network, Circle is removing the remaining structural frictions that have kept institutional balance sheets sidelined.”
The lending facility enforces strict risk-management and margin-maintenance standards, aligning with Circle's broader compliance-first regulatory strategy ahead of evolving global stablecoin oversight.
