Circle, the company behind the USDC stablecoin, is set to launch its new layer-1 blockchain, Arc, with institutional access via Fireblocks. This integration aims to provide banks, asset managers, and fintech firms with immediate access to custody and compliance tools upon the network's launch.

Arc is designed as an open layer-1 blockchain specifically for stablecoin finance. It aims to provide an enterprise-grade foundation for payments, foreign exchange, and capital markets applications. A public testnet is planned for this fall, with a full launch expected by the end of 2025.

Fireblocks, a New York-based digital asset custody and tokenization platform serving over 2,400 institutions, will offer custody and compliance support, enabling its clients to transact on Arc from day one. The platform supports over 120 blockchains and facilitates settlement for institutions across global markets. This early integration is intended to give banks and asset managers "day one" access to Arc.

One of Arc's key features is the use of USDC as its native gas token, which allows users to pay transaction fees with the stablecoin. This aims to provide predictable, dollar-denominated transaction costs, addressing the volatility often associated with crypto tokens. Arc is also compatible with the Ethereum Virtual Machine (EVM), enabling developers to use existing Ethereum-based tools and frameworks.

Arc is engineered for high performance and is designed to support sub-second transaction finality. The blockchain uses a consensus mechanism called Malachite. It also features an integrated foreign exchange (FX) engine for institutional trading and optional privacy features that allow users to selectively shield balances and transactions.

Circle's move to launch Arc comes amid increasing regulatory clarity around stablecoins. The GENIUS Act, signed on July 18, provides a federal framework for dollar-backed digital tokens. Circle's expansion also includes a successful IPO in June, where the company raised $1.05 billion.

The announcement of Arc was made alongside Circle's second-quarter earnings report. The company reported a 53% year-over-year increase in revenue, reaching $658 million. USDC circulation also grew by 90% over the same period, reaching $61.3 billion by the end of June and climbing above $65 billion in early August.

Circle aims to position Arc as a central hub for stablecoin liquidity and applications. The blockchain is designed to support cross-border payments, foreign exchange, capital markets, and real-world asset tokenization. By offering a purpose-built, compliant environment for digital asset payments, Circle aims to capture a larger share of the stablecoin sector.