Circle, Privacy-Focused Stablecoin Conversion with USDCx

Circle Launches a New Era with USDCx

Stablecoin issuer Circle (CRCL) is taking an innovative step to enter the privacy-focused stablecoin market. The company has begun developing a new privacy version of the USDC token, which is pegged to the US dollar, under the name USDCx. This new token aims to provide a structure that encourages institutional adoption.

Collaboration with Privacy-Focused Blockchain

While working on this project, Circle is collaborating with privacy-focused blockchain company Aleo. According to Aleo's co-founder Howard Wu, USDCx will offer banking-level privacy, providing a more secure transaction experience that moves away from the transparency offered by traditional public blockchains.

A New Step for Institutional Adoption

Privacy-focused stablecoins aim to remove a significant barrier that prevents major financial institutions from using blockchain-based payment systems. In this context, Circle is also considering the increased institutional interest following the US GENIUS Act. With this law, major banks such as Citigroup, JPMorgan, and Bank of America have accelerated their efforts on stablecoin-based systems.

Market Transformation and Competition

The rise in institutional adoption of stablecoins is accelerating the transformation of the market. For example, Western Union plans to launch a digital asset payment system on Solana by issuing a US Dollar Payment Token. Visa is also increasing competition with its innovative solutions in this area. The US dollar remains the most popular underlying asset in the global stablecoin market.

While USDC and Tether's USDt account for a significant portion of the stablecoin market, other dollar-pegged tokens like PayPal USD are also gaining attention. Circle's strategic move may further intensify competition in the sector.