Circle Plans to Launch EVM-Compatible Layer 1 Blockchain Arc
Stablecoin issuer Circle plans to launch Arc, a Layer 1 blockchain centered around stablecoins and compatible with the Ethereum Virtual Machine (EVM), which is expected to go live on the public testnet this fall.
According to a press release, the Arc blockchain aims to provide enterprise-grade infrastructure for stablecoin payments, foreign exchange, and capital market applications. It will use its own USDC stablecoin as the native gas token and will feature a stablecoin foreign exchange engine, sub-second settlement, optional privacy features, and full integration with the Circle platform while maintaining interoperability with other partner blockchains.
Circle is not the only issuer interested in dedicated stablecoin chains. Market leader Tether is also actively involved in the development and support of two similar projects, namely Stable and Plasma.
Circle Releases Q2 Financial Report
As news of its own blockchain development emerged, Circle released its Q2 financial report. The circulating supply of USDC grew by 90% year-on-year to $61.3 billion, and as of August 10, it increased by another 6.4% to reach $65.2 billion. Total revenue and reserve income rose 53% year-on-year to $658 million; other revenue increased by 252%, reflecting strong growth in subscription, service, and trading revenue.
Despite the business growth, Circle recorded a net loss of $482 million this quarter, primarily due to non-cash expenses related to its IPO, totaling $591 million. This included $424 million in stock-based compensation and $167 million in costs arising from the increased fair value of convertible bonds. Adjusted EBITDA rose 52% year-on-year to $126 million.
Circle co-founder, CEO, and chairman Jeremy Allaire stated, “I am proud of Circle’s performance in Q2, which is our first quarter as a public company. We have demonstrated continued growth and adoption across a diverse set of industry partners and use cases.”
Circle also highlighted the significance of the U.S. President Trump’s signing of the GENIUS Act last month, which establishes a federal regulatory framework for payment stablecoins. The company stated, “Circle’s long-standing commitment to compliance has been formally enshrined in regulation under the obligations set forth by GENIUS, further solidifying our position as a leading regulated stablecoin issuer.”
According to data from TradingView, following the announcement, Circle’s stock price (ticker: CRCL) rose by about 16% in pre-market trading on Tuesday but retreated after the opening, ultimately closing at $163.21, a gain of approximately 1.27%.
Circle is the world’s second-largest stablecoin issuer, with a market share of 24% for USDC. The leading issuer, Tether, holds a market share of 60%, with a market capitalization of $164.8 billion for USDT.
