Circle is trying to do something deceptively simple that could have enormous consequences for how value moves on blockchains. Its new Arc blockchain is an enterprise focused Layer 1 network where USDC is not just a token traded on top of the chain but the actual gas used to pay transaction fees. That design removes the annoying step of buying ETH or another volatile coin just to move dollars which gives institutions predictable dollar based costs every time they touch the network.
The testnet already looks more like a financial conference than a crypto experiment. Arc’s public testnet has drawn more than 100 participants including BlackRock Visa Goldman Sachs BNY Mellon Deutsche Bank and major exchanges like Coinbase and Kraken. Visa is testing how stablecoin based gas and fast deterministic settlement can speed up global payments while BlackRock is exploring Arc for on chain settlement and foreign exchange. Circle describes the network as an economic operating system built for things like tokenized money markets credit funds and cross border payments where finality times are measured in fractions of a second instead of days.
Putting USDC at the center of this system changes its role from a simple trading chip into the native fuel of a new financial stack. Arc uses USDC as the gas token which means every smart contract call every payment and every settlement event spends a small amount of digital dollars rather than a speculative asset. For treasurers and risk officers that matters because their costs are now linked to a currency they already understand rather than a token whose price can swing 10% in a week. It effectively turns blockchain activity into metered software usage in dollars and that predictability is exactly what traditional finance likes.
Behind Arc sits Circle’s balance sheet which is starting to look like a mid sized country. Recent data shows USDC reserves backed primarily by cash and short term United States Treasuries with Circle’s share of the broader stablecoin Treasury hoard helping push the sector’s total above the levels held by several national governments. Industry analysis indicates that stablecoin issuers collectively hold more than $180 billion in Treasuries with Circle alone managing tens of billions in highly liquid instruments. That positioning gives Circle both credibility with regulators and leverage within the financial system because it channels enormous demand into United States government debt.
On the equity side Circle’s listed shares under the ticker CRCL show a company that is already generating hundreds of millions of dollars in quarterly revenue before Arc even hits mainnet. Third quarter 2025 results reported total revenue and reserve income of about $740 million for the quarter up 66% year over year with revenues less distribution costs growing more than 50%. Guidance suggests full year “other revenue” from subscriptions services and transactions in the $90 million to $100 million range while USDC circulation and on chain volume continue to climb. That kind of growth helps justify a market narrative where CRCL trades at premium levels relative to current earnings based on the thesis that Arc will drive a multi billion dollar revenue run rate over time.
If Arc becomes the preferred rail for real world asset tokenization and compliant stablecoin finance Circle will sit in a powerful toll booth position. The network is designed to host fiat denominated stablecoins from multiple issuers alongside tokenized funds foreign exchange products and lending markets all paying gas in USDC. Cross chain bridges and major exchanges are already integrating with the testnet to ensure liquidity and interoperability which strengthens the moat around the ecosystem. With mainnet targeted for early 2026 and blue chip institutions building on top today Circle is effectively trying to own both the rails and the currency of a new on chain financial internet where every transaction runs on a dollar that it controls
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