Original author: 1912212.eth, Foresight News
On November 12, stablecoin issuer giant Circle released its third-quarter business update, revealing that it is exploring the issuance of a native token on its newly launched stablecoin public chain, Arc Network.
Circle aims to transition from being a mere stablecoin provider to a more comprehensive blockchain ecosystem builder. As the issuer of USDC, this move by Circle could further solidify its leadership position in the stablecoin financial sector while injecting new vitality into the Arc Network.
Arc, launched by Circle, is a stablecoin public chain that is not a general-purpose public chain like Solana or Sui, but rather a platform optimized for stablecoin payments, foreign exchange, and capital markets.
As an L1 blockchain project launched by Circle, the core team is led by Circle's executive leadership, reflecting the stablecoin giant's professional layout in the blockchain infrastructure field. Circle's CEO is Jeremy Allaire, who also serves as a co-founder of Arc, responsible for the company's overall strategy, vision, and operational execution.
The Chief Product Manager is Sanket Jain, who is also Circle's Chief Product Manager and a co-founder of Gateway. He graduated from Cornell University with a degree in Applied Economics and has previously worked as a financial analyst at Fountain Financial, LLC, and in corporate restructuring analysis at Houlihan Lokey. The Chief Software Engineer is Adrian Soghoian, who has worked at Trigger Finance and Google Chrome, bringing years of development experience.
The core innovation of Arc lies in embedding USDC at the network's base layer, avoiding the volatility issues associated with traditional gas tokens. Users can pay fees directly with USDC, achieving a seamless stablecoin trading experience. In August of this year, Circle Internet Group (CRCL) acquired the high-performance consensus engine Malachite from Informal Systems, adopting a permissioned Proof-of-Authority mechanism, with validator nodes held by known authoritative institutions.
At the end of October, Arc launched its public testnet and opened it to developers and enterprises. Currently, over 100 institutions are participating. The Circle Payments Network has onboarded 29 financial institutions and has added partnerships with Brex, Deutsche Börse, Finastra, Fireblocks, Kraken, Itaú, and Visa.
Circle Internet Group's third-quarter financial report shows that the company's revenue grew by 66% year-on-year, reaching approximately $740 million, with net profit significantly increasing. This strong performance is attributed to the surge in USDC circulation—by the end of the reporting period, USDC's market capitalization had exceeded $75 billion, making it the second-largest stablecoin globally, only behind Tether's USDT.
In the context of a tightening global regulatory environment, Circle's compliance advantages are particularly prominent, with its USDC recognized under the EU's MiCA regulations and widely used across several mainstream exchanges and DeFi protocols.
Unlike traditional blockchains, Arc uses USDC as its native gas token, meaning transaction fees can be paid directly in USDC, enabling instant settlement and privacy options. The network is EVM-compatible, making it easier for developers to migrate applications, and has been deeply integrated with Circle's ecosystem, including tools like USDC, CCTP (Cross-Chain Transfer Protocol), and Gateway.
In its Q3 report, Circle explicitly stated: "We are exploring the possibility of issuing a native token on the Arc network, which will enhance network participation, drive adoption, further align the interests of Arc stakeholders, and support the long-term growth and success of the Arc network."
Although this statement is still in the "exploration" phase, it is enough to stimulate market imagination.
Why Issue a Token
In the stablecoin market, Tether, as the issuer of USDT, is actively building a dedicated blockchain ecosystem through the launch of Plasma and Stable networks, which directly prompts Circle to accelerate its exploration of native token issuance on the Arc network to maintain its competitive advantage.
The stablecoin public chain Plasma, supported by Tether, is optimized for USDT payments, supporting zero-fee USDT transfers and EVM compatibility. Its token offerings and deposits have attracted countless investors, generating significant popularity. Currently, its token XPL has a market capitalization of $490 million, with a fully diluted valuation (FDV) still at $2.6 billion. Another stablecoin public chain supported by Tether, Stable, has also attracted massive funds after opening deposits, with the first phase of $1 billion quickly filled, and the second phase's limit of $500 million was also lifted due to high participation, ultimately reaching nearly $1.8 billion in total deposits.
With the expansion of stablecoin public chains, exchanges, and trading pairs, Tether firmly occupies a dominant market position. USDC is still in a catch-up role.
U.S. Treasury Secretary Janet Yellen stated today that by 2030, the scale of stablecoins could grow from $300 billion to $3 trillion, a tenfold increase.
The market is also very receptive to the narrative of stablecoin public chains. Previously, USDE's market capitalization surged to nearly $15 billion in just two years, and many stablecoins have emerged from public chains and DeFi protocols.
Circle is listed in the U.S., which can only meet the investment needs of U.S. investors, but does not satisfy the needs of its native community. A native token is a powerful tool to attract attention within the community.
It not only helps attract more community participants and incentivize network involvement but can also enhance Arc's adoption rate. Circle emphasized in its report that this token will "drive network growth," suggesting it may be linked to the USDC ecosystem, forming a closed-loop economic model. The addition of a native token will make this ecosystem more attractive, significantly drawing in DeFi, RWA (real-world assets), and cross-border payment applications.
The native token of Arc could address current pain points in the stablecoin network, such as high gas fees and cross-chain fragmentation. Through governance incentives, Arc could become the preferred platform for RWA and DeFi, attracting funds from institutions like BlackRock—Circle has already partnered with BlackRock for the USDC fund.
Moreover, under the trend of AI and Web3 integration, Circle's AI tools combined with the token could accelerate the development of the developer ecosystem. On the challenge side, issuing a token requires balancing centralization and decentralization. Currently, Arc's permissioned design may limit community participation, and if the token is poorly designed, it could lead to speculative bubbles. The market competition is fierce: L1s like Solana and Base are already mature, and Arc needs to prove its unique advantages in stablecoins.
In the long run, this exploration aligns with the trend of blockchain evolution: transitioning from general-purpose platforms to vertical ecosystems. Circle's Q3 profit growth proves its business model is sustainable, and the native token will be a catalyst.
Currently, participants can claim test tokens on the testnet and participate by deploying contracts on the testnet. The official has released detailed tutorial documents.
With Plasma and Stable deposits attracting countless participants, and Coinbase launching a new project platform with Monad as the first project, it remains to be seen whether ARC will also open ICO quotas.
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