CryptoSlate
Circle closed a $222 million presale of ARC, the native token of its planned institutional blockchain Arc, at a $3 billion fully diluted valuation on May 11, with a16z Crypto leading a $75 million ticket and BlackRock, Apollo Funds, Intercontinental Exchange, SBI Group, Janus Henderson, Standard Chartered Ventures, General Catalyst, IDG Capital, Haun Ventures, and Bullish joining the round. The capital raise landed alongside first-quarter results that showed $694 million in total revenue and reserve income, up 20% year on year, USDC circulation up 28% to $77 billion, and on-chain transaction volume of $21.5 trillion, up 263% year on year. Clear Street lifted its Circle price target from $152 to $157 on the back of the stack expansion.
Why it matters
Arc gives Circle something it has never had: a venue it controls. USDC already settles across more than 30 chains, so Circle earned from issuance economics wherever the activity cleared. Arc re-routes that growth story into a network where Circle can also capture transaction, validator, and infrastructure revenue. The chain is being positioned as EVM-compatible, stablecoin-native, with deterministic sub-second finality and configurable privacy tuned for institutional settlement of payments, tokenized assets, FX, capital markets, and AI-driven commerce. ARC itself is framed as a coordination token for validators, builders, liquidity providers, and institutions, while USDC stays the transactional asset on top.
The investor mix is the read. a16z Crypto, BlackRock, Apollo, ICE, Standard Chartered, and Janus Henderson are not pure-crypto capital; they are TradFi allocators buying a thesis that on-chain dollars become settlement infrastructure for the next internet stack. CEO Jeremy Allaire framed the quarter around "the rapid convergence of AI platforms and economic operating systems into a new internet stack," signalling that Circle wants to be valued as a full-stack infrastructure company, not a rate-cycle bet on reserve income.
Market impact
The strategic friction is with Coinbase. Coinbase's Q1 disclosure showed it holds 25% of total USDC in circulation across its products, that Base processed 62% of global on-chain stablecoin volume, and that over 90% of on-chain agentic stablecoin volume ran on Base, with more than 100 million payments cleared through the x402 protocol and 99% of those in USDC.
Frequently asked questions
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What is Arc and why is Circle launching its own L1 blockchain?
Arc is Circle's planned EVM-compatible public blockchain built for institutional finance — payments, tokenized assets, FX, capital markets, and AI-driven commerce. It gives Circle a network it controls rather than relying on third-party chains for USDC settlement.
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Who led the ARC token presale and what was the valuation?
Circle raised $222 million at a $3 billion fully diluted valuation on May 11. a16z Crypto led with a $75 million investment, with BlackRock, Apollo Funds, Intercontinental Exchange, SBI Group, Janus Henderson, Standard Chartered Ventures, General Catalyst, IDG Capital, Haun Ventures, and Bullish participating.
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How does Arc compete with Coinbase's Base network?
Both stacks target stablecoin payments, agentic commerce, and institutional settlement. Coinbase's Q1 disclosure showed Base processed 62% of global on-chain stablecoin volume and 90%+ of agentic stablecoin activity. Circle's Arc + Agent Stack + CPN stack is now competing for the same flows Coinbase monetizes through…
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What were Circle's Q1 2025 financial results?
Circle reported $694 million in total revenue and reserve income, up 20% year on year, with USDC circulation up 28% to $77 billion and on-chain transaction volume of $21.5 trillion, up 263% year on year.
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Why are analysts calling this a Coinbase rivalry rather than a partnership shift?
The Circle-Coinbase relationship was historically issuer-distributor, with Coinbase earning share from USDC distribution. Arc gives Circle a venue to capture transaction and infrastructure revenue directly, overlapping with Base's core thesis. Industry voices including Dragonfly's Omar Kanji and Entropy Research's Tom…
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