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Circle’s new Arc blockchain went live on September 16 with a design choice that inverts the usual layer-1 model: transaction fees are paid in USDC, the stablecoin itself, not in Arc’s own freshly minted ARC token.
Arc, Circle’s layer-1 network for payments and financial markets, launched its public mainnet on September 16 with EVM compatibility and sub-second settlement finality, according to the launch announcement on Arc’s blog.
“This is, I believe, the most consequential major platform launch in our history, and I think an even more consequential launch than USDC itself,” Circle CEO Jeremy Allaire said at a press briefing.
The company targets roughly one cent per transaction, and because fees are paid in USDC, that price stays predictable in dollar terms rather than moving with a volatile native token.
Why not ARC?
Circle minted the full initial supply of 10 billion ARC tokens at genesis, but the token is not publicly available, and the company said the mint is not a commitment to launch ARC publicly. Its stated role is coordination for security, utility and governance. USDC stays the fee currency.
The pitch is aimed at exactly the institutions Arc launched with. Founding validators named in August include BlackRock, Visa, Mastercard, ICE and the Depository Trust & Clearing Corporation (DTCC), with more than 100 institutions and companies involved at launch. A treasury desk that must budget costs in dollars has no reason to want its fee line item denominated in a token whose price it cannot control.
The permissioned structure supports the same goal. Arc currently runs on approved proof-of-authority validators, and Circle says it is exploring a transition to proof of stake in 2027, which could eventually give ARC a role in network security. The network also carries more than 20 fiat-backed stablecoins, including EURC, JPYC, KRW1 and TRYB, and connects to more than 20 blockchains through Circle’s Cross-Chain Transfer Protocol (CCTP).
Circle is also working on an opt-in privacy feature, with confidential transactions and balances readable through view keys by authorized parties, that has not yet shipped. The company is positioning Arc to serve banks and asset managers that need to use a public chain without exposing positions.
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