USDC stablecoin issuer has launched a cross-chain transfer protocol to support USDC interoperability.
The product was unveiled at the company’s inaugural crypto conference, Converge22, in San Francisco last week. The bridging protocol is expected to go live later this year on the Avalanche and Ethereum mainnets.
USDC Will Be Available On Five New Chains
Circle additionally announced that its bridging protocol, officially dubbed “Cross-Chain Transfer Protocol,” will allow the USDC stablecoin to be launched on Polkadot, Optimism, Near, Arbitrum, and Cosmos by the end of 2023.
In a Twitter announcement, Circle states, “Cross-Chain Transfer Protocol is permissionless and enables USDC to be sent natively across ecosystems, improving liquidity and reducing fragmentation of bridged assets.” The stablecoin issuer went on to say that “Developers building wallets, bridges, payments apps, financial services tools [and] more will be able to deliver simple, cross-chain USDC transactions – simplifying the user experience and maximizing capital efficiency”
Joao Reginatto, Circle’s Vice President of Product, has stated that the latest expansion is part of the company’s multi-chain vision. He also remarked that developers prefer multi-chain projects over single-chain projects.
Reginatto goes on to say that the expansion will allow institutions, exchanges, developers, and others to innovate and gain easier access to the USDC stablecoin.
Circle notes that adding USDC to five additional blockchain ecosystems will provide stablecoin USDC users with “greater liquidity and interoperability” within the crypto economy.
Partnerships And Competition
In a partnership announcement by NEAR, one of the blockchains to integrate USDC, stated, “Bringing USDC to NEAR will help empower developers to integrate stablecoin payments flows into their Javascript and Rust-based decentralized applications. This will unlock a new wave of accessibility for Web2 builders moving into Web3. It will also serve a vital role in NEAR’s mission of Web3 mass adoption while helping developers build without limits.”
Circle’s expansion comes when competition among stablecoins is heating up. Stablecoins are cryptocurrencies tied to a fiat currency, such as with USDC pegged at a 1:1 ratio to the US dollar. They are also a $150 billion asset class within cryptocurrencies that serve as a significant transaction and trading bridge between traditional finance and the crypto space. USDC is the world’s second-largest stablecoin by market capitalization and is widely used on decentralized finance platforms.
Despite its size, Circle has lost significant market share, and its circulating supply has fallen to $49 billion from $55 billion since August. A plethora of decentralized finance (DeFi) platforms are opting to issue their own native stablecoins, whilst competing issuers like Tether and Binance have ramped up the expansion of their respective stablecoins, USDT and BUSD.
The Converge22 conference also saw the announcement of a partnership agreement to support USDC on Robinhood’s new non-custodial wallet.
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