Circle launched its Arc blockchain mainnet on Sept. 16, bringing a stablecoin-native Layer 1 designed to address institutional adoption barriers that have constrained on-chain finance.
Arc operates as a permissioned network with deterministic finality—eliminating the probabilistic settlement and chain reorganization risk endemic to proof-of-work and standard proof-of-stake systems. The platform uses USDC as its native gas token, with fees denominated in stablecoins rather than volatile assets. A paymaster system allows alternative stablecoin gas payments.
The fee mechanism adapts Ethereum's EIP-1559 model, replacing block-level adjustments with a weighted moving average of network demand to smooth costs. All collected fees flow into an on-chain Arc Treasury.
Circle identified three structural gaps in existing blockchains that hampered enterprise stablecoin adoption: probabilistic settlement with reorg risk, lack of privacy controls for sensitive commercial transactions, and fragmented liquidity across networks. Arc incorporates optional privacy features aligned with regulatory compliance and includes native bridges to other blockchains and traditional finance infrastructure.
Rachel Mayer, Circle's VP of Product Management, said: "We've helped enterprises and builders use USDC across dozens of networks. The consistent feedback has been: make costs predictable, settlement finality deterministic, and privacy compatible with real-world obligations."
Arc's permissioned validator set includes BlackRock, DTCC and Visa. The network processed more than 700 million transactions during its testnet phase, which ran from October 2025. On its first day of mainnet operation, Arc onboarded over 100 institutional and ecosystem partners.
Circle CEO Jeremy Allaire called the launch "the single most significant launch in Circle's history since USDC itself" in a press release.
USDC currently has approximately $74 billion in circulation as of September 2026. The mainnet launch follows the July 2025 passage of the GENIUS Act, which President Donald Trump signed into law, establishing the first federal stablecoin regulatory framework.
