In a significant development, Circle, the issuer of the US dollar stablecoin (USDC), has announced the launch of native USDC tokens on Ethereum’s layer 2 scaling protocol, Polygon. This move marks a major milestone in the expansion of USDC’s ecosystem.
Circle Makes a Bold Move with Polygon
USDC is now accessible to both users and developers without the need to bridge the stablecoin from Ethereum or other blockchains. The new offering is expected to enable near-instant, low-fee transactions for a variety of use cases including payments, remittances, trading, borrowing, and lending.
Previously, users of the protocol had to make use of bridge USDC (USDC.e) from the Ethereum blockchain. However, with this new development, Circle assures that its new offering will be redeemable at a 1:1 ratio for US dollars.
The launch of native USDC on Polygon PoS took place on October 10th. This was followed by a transition away from bridged USDC for ecosystem apps, developers, and users. The transition also coincided with a discontinuation of support for deposits and withdrawals of bridged USDC via Circle Account and its APIs on November 10th.
Circle’s move to mint USDC natively on Polygon taps into Polygon’s scaling capabilities. This is expected to boost the growth of native USDC liquidity over time and replace the bridged USDC liquidity that comes from Ethereum via the Polygon PoS Bridge.
The benefits of native USDC are numerous. It is fully reserved and always redeemable 1:1 for US dollars. USDC is supported by Circle Account and its APIs, enabling institutional on/off-ramps. It also promises future support by #CCTP to eliminate bridge withdrawal delays.
According to Circle’s announcement, businesses and developers will be able to build decentralized applications (DApps) with USDC on Polygon. This development is expected to facilitate the transfer of USDC based on Polygon to and from the Ethereum blockchain.
In conclusion, Circle’s launch of native USDC on Polygon marks a significant step forward in enhancing the scalability and efficiency of the stablecoin ecosystem.