Circle, the issuer of USDC, has officially launched the public testnet of its new Layer-1 blockchain Arc, designed as an open network for companies and developers moving economic activity on-chain.
The initiative has already attracted over 100 partners across the financial and technology sectors, including BlackRock, Visa, Mastercard, HSBC, and Goldman Sachs. According to Circle, Arc aims to become “the economic operating system for the Internet.”
A Blockchain Built for the Global Digital Economy
Unveiled in August 2025, Arc is designed to power the next generation of financial infrastructure, supporting use cases such as lending, capital markets, foreign exchange, and cross-border payments.
Among Arc’s key features are:
- Stable USD-based transaction fees
- Sub-second finality
- Optional privacy layer
- Native integration with Circle’s full technology stack
“Since opening the public testnet, we’ve seen remarkable early momentum,” said Jeremy Allaire, co-founder and CEO of Circle.
“Leading companies and protocols are already testing real-world solutions. Collectively, these organizations serve billions of users and process hundreds of trillions of dollars in annual transaction volume. Arc is built to connect every local market with the global economy.”
Toward a Decentralized Governance Model
For now, Circle oversees Arc’s development, but the company plans to transition governance to a distributed network of validators and institutional partners — including banks, fintechs, and infrastructure providers.
Future roadmap milestones include:
- Expanding the validator set
- Implementing transparent on-chain governance
- Enabling community participation in protocol evolution
The long-term vision, Circle says, is to make Arc a “shared and neutral economic layer for the Internet — open, cryptographically verifiable, and collectively governed.”
Institutional Backing and Early Participants
Major financial institutions are already experimenting with Arc’s capabilities:
- BlackRock’s Head of Digital Assets, Robert Mitchnick, highlighted the potential for stablecoin-denominated settlements and on-chain FX to enhance capital markets efficiency.
- HSBC’s Head of Global Payments Solutions, Manish Kohli, emphasized the importance of faster and more transparent international payments.
- Raj Dhamodharan, EVP of Blockchain & Digital Assets at Mastercard, said the company is exploring how Arc could enable programmable and secure payment scenarios.
Allaire added that Arc empowers enterprises “to build on enterprise-grade blockchain infrastructure, fostering a more open, inclusive, and efficient global economic system that operates natively online.”
Powered by Malachite Consensus
To build Arc, Circle acquired the Malachite consensus mechanism from Informal Systems, incorporating its technology as the backbone for the new L1 network. Nine Informal Systems engineers have also joined Circle to support the project’s ongoing development.
