On May 11, before the U.S. stock market opened, Circle Internet Group (NYSE: CRCL) announced the closing of the ARC token presale: $222 million raised, $3 billion FDV, 740 million tokens sold at $0.30 each. The number is large for any crypto fundraise in 2026 — but what makes the operation singular is not the size. It's that, for the first time in history, a public company listed on an exchange conducted a token presale. The legal and financial engineering behind this first-of-its-kind will be studied in business schools for years to come.
The round was led by a16z crypto, with $75 million — signaling crypto-native institutional acceptance. The other names on the cap table compose the most complete TradFi+crypto+enterprise lineup ever to participate in an L1: BlackRock, Apollo Funds, Intercontinental Exchange (NYSE), SBI Group, Janus Henderson, Standard Chartered Ventures, General Catalyst, Marshall Wace, ARK Invest, IDG Capital, Haun Ventures and Bullish (owner of CoinDesk). When the NYSE buys tokens from Circle's chain on the same day Circle reports Q1 with +20% YoY revenue, the signal is simultaneous technical-political: tokenized dollar infrastructure entered institutional balance sheets as a strategic asset.
But the news has a second layer. BlackRock, which three days ago filed 17 pages asking the OCC to lift the 20% ceiling on tokenized reserves, now appears as an investor in the blockchain that will house the end product of that reserve. Circle, which needs the CLARITY Act approved on May 14 to consolidate the rewards gap, conducts the fundraise on the exact day the ABA escalates lobbying against that same bill. The timing is institutional coordination, not chance.
What Arc is, in concrete terms
Arc is an EVM-compatible Layer-1 designed from scratch for stablecoin finance. It's not an Ethereum fork, not an L2 appchain, not a Solana fork. It was built with an explicit objective: to serve as institutional monetary infrastructure, with five characteristics that differentiate it from everything in production in the market.
1. USDC as native gas, not volatile token
Every transaction on Arc pays fees in USDC. There is no ARC consumed for execution, no volatile token whose pricing affects the unit cost of transfers. For a corporate treasury running 50 million operations per day (the scale of a Visa Direct or Western Union), fee predictability is more important than absolute value. On Ethereum, an operation that cost $0.30 in fees on a Thursday can cost $1.80 on a Monday — the same transaction. On Arc, the fee is quoted in USDC and remains stable. This attribute alone justifies the institutional migration thesis.
2. Malachite consensus, finality below 1 second
Arc runs the Malachite engine (BFT variant developed by Informal Systems, based on Tendermint Core) with benchmarks showing 780 milliseconds for 100 validators with 1 MB blocks. For comparison: Ethereum L1 has finality of ~13 minutes (probabilistic) or 64 epochs (~12 minutes in Casper FFG). Solana has soft finality in ~400ms but hard finality in ~12 seconds. Arc operates with deterministic finality — not probabilistic — which eliminates challenge risk, the nightmare of any corporate operation that needs to close settlement with a bank at a fixed time.
3. StableFX — integrated 24/7 on-chain FX engine
Here is the most underestimated component of the architecture. Arc is born with StableFX, an institutional FX engine embedded in the protocol that enables stablecoin pair trading (USDC/EURC, USDC/USYC, USDC/USDP, and — relevant for Brazil — USDC against tokenized real, tokenized Mexican peso, tokenized yen and others) with real-time on-chain settlement. The conceptual design is that of a multi-bank FX desk running on blockchain, with aggregated liquidity from institutional market makers, but with user self-sovereign custody.
The consequence is structural: Arc competes not only with Plasma and Tempo in the stablecoin space; it competes with the SWIFT-CLS system for cross-border FX trade. If StableFX functions with deep liquidity in at least five major pairs (USDC/EURC, USDC/JPY, USDC/CHF, USDC/GBP, USDC/CAD), the use case for remittance, treasury management and institutional settlement becomes complete without needing a correspondent bank.
4. Confidential transfers — modular opt-in privacy
Arc offers a privacy module called confidential transfers that hides the transfer value (but not addresses) using Trusted Execution Environments (TEE) — secure enclaves within the validators themselves. The compliance innovation is the viewing key: the user can give a regulator or auditor a specific view-key that opens their transfers for inspection without needing to open the entire blockchain ledger.
Translation: Arc simultaneously meets the requirements of corporate balance sheet privacy (a multinational doesn't want competitors to see its cash flow in real time on-chain) and regulatory compliance (BCB, Treasury, IRS can audit case by case). This is the technical solution that MiCA, GENIUS Act and Brazilian regulators have asked for in separate forums — and Arc delivers out of the box.
5. Complete native Circle stack
Arc is not a generic chain. It comes with native integration of USDC, EURC, USYC (Hashnote tokenized treasury), Circle Payments Network (CPN), Circle Mint, Wallets, Contracts, CCTP (Cross-Chain Transfer Protocol), Gateway and Paymaster. For a developer who wants to build a payment or treasury product, Arc offers on day one what they would have to integrate piece by piece on any other chain.
The timeline and 100 institutes on testnet
Arc's public testnet went live on October 28, 2025. In seven months, more than 100 institutions ran active tests — Circle confirms BlackRock, Visa and HSBC as named participants. Mainnet beta is scheduled for 2026 (exact date not yet published), with a declared path to fully decentralized proof-of-stake and community governance. Worth noting: all of this is already built and operational on testnet for seven months; today's presale is not R&D financing, it's capitalization for mainnet go-to-market.
In April 2026, Circle announced that Arc will have post-quantum cryptography features enabled from launch, with quantum-resistant algorithms for signature and zero-knowledge proof. It's the first institutional L1 to make this explicit declaration — protection against the Shor's algorithm scenario in 10-15 years that would be expensive to do retroactively on a mature chain.
The ARC token — what it's for
Arc's tokenomics design is deliberately different from crypto-native standards. Since gas is charged in USDC, ARC has no payment function. The declared functions are three:
- Staking — validators need to stake ARC to participate in PoS consensus on mainnet. The larger the stake, the greater the weight in the validation committee.
- Governance — voting on protocol parameters, upgrades to core smart contracts, list of supported stablecoins in StableFX, and protocol improvement proposals.
- Value capture via fee redirection — a fraction of USDC fees paid on the chain can be converted and used for ARC burning, burn programs or buyback. The formal whitepaper doesn't detail the exact fraction yet, leaving it for governance to decide post-launch.
The $0.30 presale and $3 billion FDV implies the tokenomics setup distributes today approximately 10 billion total ARC tokens (740 million sold in presale represent 7.4% of total supply). The lockup and unlock cliff for investors have not yet been published in detail, but standard venture round vesting of 12-36 months is expected.
The three stablechains — Arc, Plasma and Tempo
Arc is not the only project to internalize stablecoin infrastructure. The stablechain movement currently has three major names at different stages:
- Plasma (Tether/USDT) — mainnet already live, PlasmaBFT consensus, +1,000 TPS, USDT as native token. Plasma serves retail: instant and free USDT transfer for end users.
- Arc (Circle/USDC) — mainnet beta in 2026, institutional focus, USDC as gas, StableFX and modular privacy. Arc serves the enterprise.
- Tempo (Stripe) — in development, multi-stablecoin (supports USDC, USDT, EURC and future ones), focused on consumer-merchant payments. Tempo serves e-commerce.
The division of roles is deliberate and non-overlapping. Tether dominated the retail market and wants to maintain it — Plasma is turf defense. Circle never beat Tether in raw volume, so pivot to enterprise where compliance and privacy matter — Arc is a margin thesis. Stripe wants to be the payment layer that abstracts which stablecoin is used — Tempo is multi-issuer by design.
For an institutional buyer, the choice between the three is less about technology and more about who is willing to operate with whom on the compliance side. Arc, with Circle, has clear MiCA and GENIUS Act paths. Plasma, with Tether, has heavier OFAC scrutiny and has the history of balance freezes at OFAC request. Tempo, with Stripe, inherits the PCI-DSS payment framework and bank charter applied to regulated fintech. These three regulatory regimes are incompatible in cross-product flows, so fragmentation will exist.
The verticalization that is rewriting the sector
Two years ago, the dominant model for stablecoins was that of the tenant: the issuer (Circle, Tether) issued USDC or USDT as ERC-20 token on Ethereum, SPL on Solana, TRC-20 on TRON. The chain was borrowed infrastructure, the issuer was tenant. Paid fees in ETH, SOL, TRX to mint and transfer.
The model emerging in 2026 is that of the landlord: the issuer builds their own chain, defines the gas token as their own product (USDC), captures fee economics internally, and rents the chain to other applications to use. The value flow inverts. Before, USDC paid to use Ethereum; now, Ethereum has to decide if it wants USDC competing with ETH, or if it accepts losing transaction volume to Arc.
The systemic effect is what the Chainalysis five-criteria framework already anticipates: the "Goldilocks" archetype (middle-market chains between Lindy and High-Frequency) will be dominated by vertical stablechains, not generic L2s from Ethereum like Base, Arbitrum or Optimism. L2s will survive, but in a different niche — high-frequency DeFi, NFTs, gaming. Institutional payment, corporate FX and RWA settlement will migrate to Arc, Plasma and Tempo.
The inflection point for Brazil
Arc's StableFX explicitly mentions tokenized Brazilian real in the list of supported pairs. It's not hypothetical: today, Circle integrates USDC natively to PIX via Brazilian banking partners (Inter, Will Bank, fintechs like Letsbank), with real-time onramp and offramp. BCB Resolution 561, which Lagarde endorsed in Madrid on May 8, prohibits dollar stablecoin in the foreign exchange context (eFX). But Arc's StableFX, by design, doesn't operate in eFX — it operates in self-custodial on-chain settlement.
The practical result: if a Brazilian investor has USDC in a self-custodial wallet and wants to trade for tokenized BRL, they can do this operation directly on Arc, without passing through a centralized exchange, without passing through eFX, without falling under Resolution 561's scope. The operation is viewed by Resolution 521 (foreign exchange radar in self-custody) but is not prohibited — it is reported. The difference between prohibition and reporting is what defines if the market will exist.
This design creates a legal technological workaround for Resolution 561, and the BCB knows this. The next BCB Resolution — likely in Q3 or Q4 2026, after consolidating data from radar 521 — will need to decide whether to update the scope to include self-custodial trades via stablechain. If updated, it scales enforcement. If not updated, it leaves Arc operating as a technical bypass.
The macro scenario — who wins, who loses
Scenario 1 — Arc reaches mainnet in Q3 2026 with StableFX liquidity in 5+ pairs: Circle positions itself as Sovereign Operator of a new monetary network. Captures fee economics that today goes to Ethereum/Solana. CRCL stock continues revaluation trajectory. BlackRock, Apollo and a16z compound gains via ARC token + USDC reserve volume. Tether counter-attacks with Plasma upgrades. Stripe accelerates Tempo to mainnet.
Scenario 2 — Mainnet delays to 2027 or StableFX has thin liquidity: Arc becomes permanent testnet with 100 institutes in proof of concept, but without production volume. CRCL stock corrects. Presale investors become illiquid during lockup, reducing commercial traction.
Scenario 3 — SEC or OCC retroactively blocks the presale: unlikely scenario because Circle is a registered entity and carefully structured the presale as a SAFT (Simple Agreement for Future Tokens) with Reg D qualification for accredited investors. But if an enforcement letter comes out from the SEC contesting the structure, the precedent of "first token presale by public company" becomes a restriction instead of template. That's exactly what CLARITY Act definitively kills — because the bill clarifies that digital commodities are not securities. There's another reason for Circle's timing to be today, three days before CLARITY's markup.
The ON3X perspective
Three readings for the Arc presale and what it inaugurates:
- The stablecoin-as-tenant model ended; the stablecoin-as-sovereign model began. For ten years, the issuer (Circle, Tether, Paxos) issued the token, and the chain hosted it. In 2026, the issuer becomes the chain. The value flow migration is massive — in ETH gas alone, USDC represents estimated volume of $2-4 billion per year in fees paid by Circle and users to Ethereum validators. If Arc captures 50% of this volume in 2027, that's $1-2 billion per year that leaves the ETH staker's balance and enters Circle's. Crypto is witnessing the first consolidated power transition since Bitcoin → smart contracts. Whoever doesn't understand this will build product on the wrong chain.
- The presale by public company is a legal-financial precedent that will be copied in waves. Circle (CRCL) is first; next will be Coinbase, or Robinhood, or PayPal, or Visa, or MasterCard. When the template of SAFT-Reg-D-presale by listed public company is validated by the market and by the SEC (which didn't block, a positive signal), token fundraise becomes a legitimate corporate instrument, parallel to equity follow-on. In three years, it will seem surreal that companies raised money only via stock dilution. The token as a corporate capital instrument is the new class being inaugurated today.
- Brazil has 12-18 months to decide whether it enters the bridge or gets run over by it. Arc mentions tokenized BRL in StableFX. Circle has PIX onramp. B3 is running private digital real after resolution 519 that buried Drex. There is technical space for a regulated tokenized real that would be settled natively on Arc against USDC with instant settlement. Either the BCB and CMN understand this and license the operation (capturing tax revenue and foreign exchange visibility), or Brazil will see capital flow to Arc operating from offshore — capital that today stays in USDT TRC-20 losing 1-2% per year in regulatory risk. The political window to do this closes when Arc's mainnet launches, in Q3-Q4 2026. After that, the infrastructure is ready and Brazilian regulator becomes reactive, not proactive. It's time for Brazil's financial sector to write to the BCB, CVM and CMN demanding a clear position before Arc decides the future of tokenized real outside of Brazil.
Frequently asked questions
What is Circle's Arc and what was launched today?
Arc is an EVM-compatible Layer-1 blockchain developed by Circle (issuer of USDC) for institutional stablecoin finance. On May 11, 2026, Circle (CRCL) closed the ARC token presale, raising $222 million in a $3 billion FDV round, with 740 million tokens sold at $0.30 each. It is the first token presale conducted by a company publicly listed on an American stock exchange.
Who invested in the ARC presale?
a16z crypto led the round with $75 million. Other investors include BlackRock, Apollo Funds, Intercontinental Exchange (parent of NYSE), SBI Group, Janus Henderson, Standard Chartered Ventures, General Catalyst, Marshall Wace, ARK Invest, IDG Capital, Haun Ventures and Bullish.
What technically differentiates Arc from other blockchains?
Five differentiators: (1) USDC as native gas instead of volatile token, ensuring predictable fees in dollars; (2) Malachite consensus with deterministic finality in ~780ms; (3) StableFX, integrated 24/7 FX engine for on-chain stablecoin pair trading including tokenized BRL; (4) confidential transfers via TEE with viewing key for selective audit; (5) native integration with entire Circle stack (CPN, Mint, Wallets, CCTP, Gateway, Paymaster, USYC).
How does Arc compare to Plasma and Tempo?
The three are vertical "stablechains," but with different focus. Plasma (Tether/USDT) already has live mainnet with PlasmaBFT and +1,000 TPS, focused on retail transfers. Arc (Circle/USDC) enters mainnet beta in 2026 with institutional focus, FX engine and modular privacy. Tempo (Stripe) is in development and will be multi-stablecoin, focused on consumer-merchant payments.
What does this have to do with BlackRock's comment letter to the OCC?
BlackRock is an investor in both Circle and the Arc presale, and three days prior filed a comment letter with the OCC asking to lift the 20% ceiling on tokenized reserves for GENIUS Act stablecoins. The alignment is structural: BlackRock provides reserve via BUIDL/BSTBL, Circle issues USDC and operates Arc as a dedicated chain, ICE/NYSE provides the regulated institutional infrastructure. It is the assembly of the complete tokenized dollar stack.
What does Arc mean for Brazil?
StableFX includes tokenized Brazilian real among operable pairs, and Circle already integrates USDC to PIX via banking partners in Brazil. Since StableFX operates with self-custodial settlement instead of eFX, it creates a technical-legal path that escapes Resolution 561's prohibition. The question is whether the Brazilian regulator will update the scope to include stablechain trades or let Arc operate as a bypass. The decision has a 12-18 month window before the infrastructure enters production.