Circle, the issuer of the USDC stablecoin, has launched the public testnet for its Arc blockchain, a new Layer-1 network designed to power the next era of on-chain finance. With over 100 major institutions including BlackRock, Visa, HSBC, Deutsche Bank, and Coinbase already onboard, Arc marks one of the most ambitious efforts yet to merge traditional financial infrastructure with blockchain technology.
Arc Blockchain: Stability, Speed, and Enterprise Focus
At its core, Arc is built for stability and speed. Every transaction on the network uses USDC as native gas, creating predictable, fiat-denominated costs that appeal to enterprises wary of crypto volatility. Its sub-second settlement capability enables near-instant global money transfers, far outpacing traditional banking systems.
Integrated Financial Tools and Privacy Features
Beyond payments, Arc integrates advanced financial tools directly into its design. A built-in foreign exchange (FX) engine allows 24/7 on-chain swaps between stablecoins via an institutional-grade request-for-quote (RFQ) system, supporting seamless cross-currency settlement and real-time price discovery. For privacy-conscious institutions, opt-in confidentiality features let firms hide sensitive transaction details while maintaining compliance with regulatory frameworks.
The blockchain is also EVM-compatible, meaning developers can deploy existing Ethereum-based smart contracts and tools without modification. This interoperability lowers adoption barriers and enables faster development of financial applications atop Arc’s infrastructure. The initiative reflects a broader institutional trend toward tokenization and blockchain-based capital markets, as major players seek more efficient ways to move and settle value.
Key Participants and Future Decentralization Plans
Participants in the Arc testnet span traditional finance (BlackRock, HSBC, Société Générale, State Street, Standard Chartered), payments and technology (Visa, Mastercard, AWS), and fintech and crypto firms (Coinbase, Kraken, Fireblocks, WisdomTree, Brex, Anthropic).
Circle has also outlined plans to decentralize Arc over time, eventually opening validator participation and governance to external stakeholders. This move could help transform Arc from a private enterprise network into a public, institution-grade blockchain supporting real-world asset tokenization, on-chain payments, and global liquidity flows.
A Shift Towards Blockchain as Core Financial Infrastructure
As institutions test Arc’s capabilities, the project underscores a defining shift: blockchain is no longer just about speculation, it’s becoming the core infrastructure for digital finance.
Related Development: ClearBank Joins Circle Payments Network
In a major step toward modernizing Europe’s cross-border payments landscape, ClearBank joined the Circle Payments Network (CPN), allowing its clients to access Circle’s MiCA-compliant stablecoins – USDC and EURC.