On August 13, 2025, Circle officially unveiled Arc, its proprietary Layer 1 blockchain designed specifically for the USDC stablecoin. Amid surging stablecoin adoption, Arc’s debut marks Circle’s entry into the trend of issuer-owned blockchains.

Arc aims to help enterprises and institutions compliantly access blockchain infrastructure through three core features:

1. USDC as the native gas token

2. High scalability and instant finality via the Malachite consensus algorithm

3. Optional privacy features for user-controlled data protection

Arc’s strategy parallels—yet diverges from—Tether’s USDT-centric chains (Stable and Plasma). Its key differentiators include:

This development carries significant implications. This article explores:

1. How Tether and Circle’s stablecoin networks differ

2. Whether competition between Circle and Tether will intensify

3. The role of other networks like Codex and 1Money Network

4. Whether Tempo (Stripe’s L1) is Arc’s real rival, not Stable/Plasma.

Source: Circle

On August 13, Circle announced Arc in its Q2 earnings report, alongside a lightweight technical whitepaper. Notably, hours earlier, Stripe unveiled its own L1 blockchain, Tempo, making the day a landmark for fintech-infused blockchains.

Arc’s launch is pivotal because stablecoins are crypto’s hottest narrative in 2025. With Tether’s Stable and Plasma (backed by Bitfinex) leading a wave of stablecoin-optimized L1s (e.g., Codex, 1Money Network), expectations were high for Circle’s response. Now, Arc is here.

But is Arc just another USDC-focused L1, or does it offer unique innovations?

Source: Arc

Arc is an EVM-compatible blockchain tailored for USDC, enabling enterprises to conduct compliant financial activities with predictable fees and optional privacy. Its core features:

• USDC as native gas: Users pay fees in low-volatility USDC.

• Instant finality: Sub-second transaction confirmation via Malachite consensus.

• Optional privacy: Customizable transparency for compliance (e.g., hiding amounts but revealing addresses).

Arc defaults to USDC for fees under an EIP-1559 model, but with key upgrades:

• Fee smoothing: Uses an exponential moving average of historical block data to stabilize base fees.

• Fee caps: Limits maximum base fees during congestion.

Via Circle Paymaster (based on ERC-4337), users can pay fees in other stablecoins, CBDCs, or tokenized deposits—bypassing volatile assets like ETH or SOL. This simplifies corporate accounting and predictability.

Early-stage fees will fund Arc’s on-chain treasury for network growth.

Arc’s Malachite consensus engine (developed by Informal Systems, a Cosmos/Tendermint veteran team) ensures:

• 3,000 TPS in tests with 20 globally distributed validators.

• 350ms finality via Tendermint BFT.

Malachite’s streamlined, Rust-based architecture includes:

• Vote Keeper: Tallying validator votes.

• Round State Machine: Core consensus logic.

• Driver: Coordinating multi-round transitions.

Arc’s upcoming "confidential transfers" will hide transaction amounts while exposing addresses for regulators. Future upgrades may add:

• Privacy-preserving order books (hidden bids/asks).

• Confidential smart contracts (e.g., private treasury management).

Technologies like TEEs, zero-knowledge proofs, and FHE will underpin these features.

• USDT-centric: Zero-fee P2P transfers but limited multi-asset support.

• Less transparent reserves vs. Circle’s audited cash/T-bills.

• Payments-focused: Aims for low-friction settlements, not financial composability.

• Backed by Stripe’s ecosystem: Recent acquisitions (e.g., Bridge, Privy) hint at end-to-end payment infrastructure.

• Niche players: Targeting emerging markets with localized stablecoins.

Arc’s real value lies in bridging TradFi and DeFi:

• For enterprises, it’s a compliant gateway to blockchain.

• For DeFi, it’s a liquidity hub for tokenized real-world assets.

While Tether dominates retail, Circle is courting institutions—a race where compliance, scalability, and interoperability will decide the winner.

(Translation adapted for conciseness, technical accuracy, and readability. Industry terms like "EIP-1559" and "Tendermint BFT" retained for precision.)

1. 术语统一:

   • "Gas费" → "gas fees" (行业标准)

   • "终局性" → "finality" (区块链术语)

   • "账户抽象" → "account abstraction" (ERC-4337标准)

2. 复杂概念简化:

   • Malachite共识模块拆分为三点，避免长句。

   • EIP-1559改进用项目符号（bullet points）清晰对比。

3. 文化适配:

   • "正面硬刚" → "Taking on head-on" (保留竞争意味)

   • "玩法" → "innovations" (避免口语化)

4. 被动转主动:

   • 中文"由...开发" → 英文"developed by..." → 优化为"Malachite consensus engine (developed by...)"更流畅。

5. 图表注释:

   • 保留"来源/Source"格式，符合国际媒体惯例。

On August 13, 2025, Circle officially unveiled Arc, its proprietary Layer 1 blockchain designed specifically for the USDC stablecoin. Amid surging stablecoin adoption, Arc’s debut marks Circle’s entry into the trend of issuer-owned blockchains.

Arc aims to help enterprises and institutions compliantly access blockchain infrastructure through three core features:

1. USDC as the native gas token

2. High scalability and instant finality via the Malachite consensus algorithm

3. Optional privacy features for user-controlled data protection

Arc’s strategy parallels—yet diverges from—Tether’s USDT-centric chains (Stable and Plasma). Its key differentiators include:

This development carries significant implications. This article explores:

1. How Tether and Circle’s stablecoin networks differ

2. Whether competition between Circle and Tether will intensify

3. The role of other networks like Codex and 1Money Network

4. Whether Tempo (Stripe’s L1) is Arc’s real rival, not Stable/Plasma.

Source: Circle

On August 13, Circle announced Arc in its Q2 earnings report, alongside a lightweight technical whitepaper. Notably, hours earlier, Stripe unveiled its own L1 blockchain, Tempo, making the day a landmark for fintech-infused blockchains.

Arc’s launch is pivotal because stablecoins are crypto’s hottest narrative in 2025. With Tether’s Stable and Plasma (backed by Bitfinex) leading a wave of stablecoin-optimized L1s (e.g., Codex, 1Money Network), expectations were high for Circle’s response. Now, Arc is here.

But is Arc just another USDC-focused L1, or does it offer unique innovations?

Source: Arc

Arc is an EVM-compatible blockchain tailored for USDC, enabling enterprises to conduct compliant financial activities with predictable fees and optional privacy. Its core features:

• USDC as native gas: Users pay fees in low-volatility USDC.

• Instant finality: Sub-second transaction confirmation via Malachite consensus.

• Optional privacy: Customizable transparency for compliance (e.g., hiding amounts but revealing addresses).

Arc defaults to USDC for fees under an EIP-1559 model, but with key upgrades:

• Fee smoothing: Uses an exponential moving average of historical block data to stabilize base fees.

• Fee caps: Limits maximum base fees during congestion.

Via Circle Paymaster (based on ERC-4337), users can pay fees in other stablecoins, CBDCs, or tokenized deposits—bypassing volatile assets like ETH or SOL. This simplifies corporate accounting and predictability.

Early-stage fees will fund Arc’s on-chain treasury for network growth.

Arc’s Malachite consensus engine (developed by Informal Systems, a Cosmos/Tendermint veteran team) ensures:

• 3,000 TPS in tests with 20 globally distributed validators.

• 350ms finality via Tendermint BFT.

Malachite’s streamlined, Rust-based architecture includes:

• Vote Keeper: Tallying validator votes.

• Round State Machine: Core consensus logic.

• Driver: Coordinating multi-round transitions.

Arc’s upcoming "confidential transfers" will hide transaction amounts while exposing addresses for regulators. Future upgrades may add:

• Privacy-preserving order books (hidden bids/asks).

• Confidential smart contracts (e.g., private treasury management).

Technologies like TEEs, zero-knowledge proofs, and FHE will underpin these features.

• USDT-centric: Zero-fee P2P transfers but limited multi-asset support.

• Less transparent reserves vs. Circle’s audited cash/T-bills.

• Payments-focused: Aims for low-friction settlements, not financial composability.

• Backed by Stripe’s ecosystem: Recent acquisitions (e.g., Bridge, Privy) hint at end-to-end payment infrastructure.

• Niche players: Targeting emerging markets with localized stablecoins.

Arc’s real value lies in bridging TradFi and DeFi:

• For enterprises, it’s a compliant gateway to blockchain.

• For DeFi, it’s a liquidity hub for tokenized real-world assets.

While Tether dominates retail, Circle is courting institutions—a race where compliance, scalability, and interoperability will decide the winner.

(Translation adapted for conciseness, technical accuracy, and readability. Industry terms like "EIP-1559" and "Tendermint BFT" retained for precision.)

1. 术语统一:

   • "Gas费" → "gas fees" (行业标准)

   • "终局性" → "finality" (区块链术语)

   • "账户抽象" → "account abstraction" (ERC-4337标准)

2. 复杂概念简化:

   • Malachite共识模块拆分为三点，避免长句。

   • EIP-1559改进用项目符号（bullet points）清晰对比。

3. 文化适配:

   • "正面硬刚" → "Taking on head-on" (保留竞争意味)

   • "玩法" → "innovations" (避免口语化)

4. 被动转主动:

   • 中文"由...开发" → 英文"developed by..." → 优化为"Malachite consensus engine (developed by...)"更流畅。

5. 图表注释:

   • 保留"来源/Source"格式，符合国际媒体惯例。