Circle, the issuer of the $76 billion stablecoin USDC, announced on Wednesday that it’s exploring the launch of a new cryptocurrency.
The token would be used for Circle’s Arc Network, the company’s layer 1 blockchain optimised for stablecoins.
Details are scarce, but the company expects the token to “further align the interest of Arc stakeholders” and drive adoption of the blockchain.
Circle introduced Arc in August and launched its public testnet in October, with over 100 institutions participating, including BlackRock, Amazon Web Services, and Standard Chartered.
Founded in 2013, Circle Internet Group has been one of the primary beneficiaries of the United States’ warming to the crypto industry.
Stablecoin competition
The launch of Arc came amid rising competition within the broader financial sector to integrate digital dollars on the blockchain, also known as stablecoins.
In July, US President Donald Trump signed into law legislation that defined which entities — banks and non-banks — could issue stablecoins and under what conditions.
The move served as a starting shot in a race now featuring Bank of America, Revolut, Societe Generale, and a host of other financial institutions vying for a slice of the stablecoin pie.
The legislation, called the Genius Act, has also moved Tether, the industry’s largest stablecoin issuer, to establish a presence in the US.
Tether has long been excluded from operating in the country due to compliance concerns and legal disputes with American authorities.
Strength to strength
Though Circle is feeling the heat, it is relatively well-funded and a popular pick among analysts as one of the companies expected to dominate the crypto industry for years to come.
In June, Circle Internet Group raised $1.1 billion in a public listing on the New York Stock Exchange, far exceeding analysts’ expectations.
Five months later, the company continues to maintain momentum.
Circle reported nearly $740 million in revenue and reserve income during the last quarter, again exceeding analysts’ forecasts.
Roughly 96% of that revenue comes from the yield generated by the treasury bills that back the USDC stablecoin.
“With growing circulation, accelerating commercial partnerships and expanding collaboration across industries, we’re proud of the tangible progress toward a more open and efficient global financial system,” Circle CEO, Jeremy Allaire, said in a statement.
Circle is valued at nearly $23 billion as of Wednesday. Analysts expect the market cap to surge.
In October, Bernstein estimated that Circle’s share price will surge to $230, 134% above its current value.
Liam Kelly is DL News’ Berlin-based DeFi correspondent. Have a tip? Get in touch at [email protected].
