Circle unveiled Arc, a layer-one blockchain built around stablecoin finance

Circle introduced Arc on August 12, 2025, describing it as an open, EVM-compatible layer-one blockchain designed specifically for stablecoin payments, foreign exchange and capital-markets settlement. The announcement marked a strategic expansion for the issuer of USDC: Circle was no longer proposing only to supply digital dollars and related services to other networks, but also to operate the foundational network on which financial applications could be built.

Arc was still a planned network on August 12. Circle said a private testnet would begin in the following weeks, a public testnet was expected during fall 2025, and a mainnet beta was planned for 2026. Those were contemporaneous targets rather than completed protocol milestones.

What Circle proposed

Circle said Arc would use USDC as its native gas asset, allowing transaction fees to be denominated in dollars instead of a volatile network token. The company also proposed an integrated request-for-quote foreign-exchange system, deterministic sub-second finality, opt-in privacy controls and native connections to products including USDC, EURC, Circle Payments Network and its Cross-Chain Transfer Protocol.

The company characterized Arc as open and composable, with compatibility for Ethereum development tools. Circle also said the network’s core software would be released under a permissive open-source license. Its consensus design was based on Malachite, technology developed by Informal Systems; Circle disclosed that the Malachite team and intellectual property had joined the company.

These specifications were issuer claims about an unfinished system. No public testnet, independent performance benchmark or production operating history existed in the evidence available on August 12. Circle’s own announcement warned that proposed features could be modified, delayed or cancelled and stated that Arc had not been reviewed or approved by the New York State Department of Financial Services.

Why the announcement mattered

Arc placed Circle in a different relationship with the blockchains that already carried USDC. The company said its products would remain available across partner networks, but a Circle-developed chain could concentrate payment activity, foreign-exchange liquidity and application integrations within infrastructure more directly shaped by the stablecoin issuer.

That created a significant strategic question. Using USDC for fees could simplify accounting for businesses that did not want to acquire a separate gas token. At the same time, Arc’s eventual governance, validator composition, privacy design and operational independence would determine whether the network delivered the openness Circle advertised. None of those questions could be resolved from the announcement alone.

Circle’s same-day SEC filing supplied scale for the decision. The company reported $61.3 billion of USDC in circulation at June 30, 2025, up 90% from the comparable year-earlier figure, and $65.2 billion as of August 10. It also reported $658 million in total revenue and reserve income for the quarter ended June 30, with $634 million coming from reserve income. Those are company-reported point-in-time and quarterly measures, not independent estimates of Arc demand, transaction volume or future revenue.

What was established on August 12

The verified development was the disclosure of Circle’s plan and intended architecture—not the launch of a functioning public blockchain. The SEC-filed earnings release confirms that Circle presented Arc as an enterprise-oriented foundation for stablecoin payments, foreign exchange and capital-markets applications and expected a public testnet in fall 2025.

This reconstruction therefore treats Arc as a material protocol and corporate commitment while preserving its event-date uncertainty. Subsequent testnet releases, code publication, validator disclosures and mainnet performance belong to later records and cannot be used to convert the August 12 proposal into an accomplished result.