What Is Arc Chain? Circle's New Blockchain Focused on Stablecoins

Circle, publisher of USDC stablecoin, officially launched Arc, a Layer-1 blockchain designed specifically for stablecoin finance, in August 2025.

Unlike mainstream blockchains like Ethereum or Solana that serve a wide range of applications, Arc is narrowly focused on efficiently moving digital assets, providing a ready-to-use infrastructure for payments, foreign exchange, and capital markets.

Circle raised $222 million through a token presale at a $3 billion valuation, backed by leading investors such as a16z crypto, BlackRock, Apollo, and ARK Invest.

With a public testnet running since October 2025 and a mainnet beta targeted for 2026, Arc marks a major step for Circle in building an "economic operating system" for the internet.

Key Points

• Arc is a new Layer-1 blockchain from Circle (the issuer of USDC) designed specifically for stablecoin finance, with USDC as the native gas token.

• Arc raised $222 million through a token presale at a $3 billion valuation, backed by leading investors such as a16z crypto, BlackRock, Apollo, and ARK Invest.

• The blockchain offers sub-second settlement finality (under 0.1 seconds), opt-in privacy, and is EVM-compatible, with a public testnet running since October 2025 and a mainnet beta targeted for 2026.

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What is an Arc Chain?

Arc is an open source Layer-1 blockchain built by Circle Internet Group (NYSE: CRCL).

This blockchain is designed as an "Economic Operating System" (Economic OS) for the internet, aiming to become the infrastructure for stablecoin-based financial applications.

Arc is fully integrated with Circle's product ecosystem, including USDC, EURC, USYC, Cross-Chain Transfer Protocol (CCTP), and Circle Payments Network (CPN).

Unlike mainstream blockchains, Arc is built to be a home for all forms of digital assets and tokenized value, from stableswap protocols to tokenized equities and commodities.

Read Also: How to Buy USD Coin (USDC)

How Arc Chain Works

Arc offers several innovative features that make it attractive to financial institutions:

1. USDC as Native Gas: Transaction fees are paid in USDC, not volatile tokens, providing stable and predictable fees.

2. Sub-Second Finality: Transactions are completed in less than 0.1 seconds using the Malachite consensus engine that Circle acquired from Informal Systems.

3. Opt-in Privacy: Users can choose to hide transaction amounts while keeping wallet addresses visible, enabling regulatory compliance without sacrificing privacy.

4. Built-in FX Engine (StableFX): Enables 24/7 stablecoin swaps with RFQ (Request-for-Quote) model and atomic PvP (Payment-versus-Payment) settlement.

5. EVM-Compatible: Developers can build using familiar Ethereum tools and frameworks.

Tokenomics ARC

Arc has ARC tokens with a total supply of 10 billion tokens.

Token allocation:

- 60% for the community: grants, builders, and ecosystem growth

- 25% for Circle: validator development, staking, and operations

- 15% for reserve: long-term stability

ARC token has main functions:

- Staking: secure the network and get rewards

- Governance: voting for protocol changes

- Fee Capture: a portion of transaction fees in USDC are used to buy and burn ARC, creating deflationary pressure

Read Also: Understanding the UNI Burn Mechanism: The Impact of Uniswap v4 and Robinhood Chain

Ecosystem and Partners

Arc has attracted more than 100 partners across various sectors:

- Banks & Asset Managers: BlackRock, Goldman Sachs, HSBC, Deutsche Bank, Standard Chartered, State Street, Apollo 

- Payments & Tech: Visa, Mastercard, Fiserv, Amazon Web Services 

- Crypto: Uniswap, Aave, Chainlink, Coinbase, Robinhood

- Regional Stablecoins: BRLA (Brazil), KRW1 (Korea), PHPC (Philippines), MXNB (Mexico), JPYC (Japan)

Arc Predictions and Prospects

With a $3 billion valuation and backing from the world's largest financial institutions, Arc has the potential to become a key infrastructure for stablecoin finance if it manages to attract significant transaction volume.

Jeremy Allaire, CEO of Circle, emphasised that “blockchain infrastructure is becoming as important as mobile operating systems or cloud platforms”.

However, analysts remain wary: Compass Point cautions against placing too much value on the project before real uses emerge, while Clear Street calls Arc an “option value” rather than a real contributor to Circle’s business.

Read Also: What is GRVT? TGE Schedule, Token Distribution, and Airdrop Guide

Conclusion

Arc is a Layer-1 blockchain designed specifically for stablecoin finance, offering stable fees (USDC), instant settlement, optional privacy, and full integration with the Circle ecosystem.

With the backing of global financial institutions and $222 million in funding, Arc has the potential to become a key infrastructure for digital payments in the future.

However, like all new blockchains, its long-term value will depend heavily on adoption and real-world transaction volume.

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FAQ

What is Arc Chain?

Arc is Circle's open-source Layer-1 blockchain designed specifically for stablecoin finance, with USDC as its native gas token and a built-in FX engine.

How is Arc different from other blockchains?

Arc is built specifically for stablecoins and financial institutions, offering stable fees (USDC), sub-0.1-second settlement, and optional privacy, unlike Ethereum or Solana, which are general-purpose.

What is the total supply of ARC tokens?

The total supply of ARC is 10 billion tokens with an allocation of 60% for the community, 25% for Circle, and 15% for the reserve.

Who are Arc's investors?

Arc raised $222 million from a16z crypto, BlackRock, Apollo, ARK Invest, Standard Chartered, and others at a $3 billion valuation.

What is StableFX?

StableFX is Arc's built-in FX engine that enables 24/7 stablecoin swaps with RFQ models and PvP atomic settlement.