Circle’s New Blockchain Gains Fireblocks Custodian Support

Circle integrates its Arc network with Fireblocks platform.

Circle, the issuer of USDC, is integrating its proprietary Layer 1 network, Arc, with the institutional platform Fireblocks.

Circle’s @Arc has landed on the Fireblocks Network 🔥

Where stablecoins and the global financial system move as one 🌎

Fireblocks expands its platform to support one of the most innovative chains for powering stablecoin finance — from secure custody and compliance to moving…

— Fireblocks (@FireblocksHQ) August 14, 2025

The platform will provide custodial support and compliance for its clients from the blockchain’s launch day. Fireblocks serves over 2,400 banks, asset managers, and fintech companies.

The blockchain is focused on stablecoin-based finance: payments, currency exchange, and capital markets. The public testnet for Arc is set to launch in the autumn, with a full network release planned for the end of the year.

This early integration has sparked discussions on X. For instance, the Solana blockchain was only added to Fireblocks at the end of 2021, nearly two years after its launch. Fireblocks clients will have access to Arc from day one.

Another Deal

On August 18, Circle acquired the Malachite consensus engine from Informal Systems. This technology will underpin the future Arc.

The deal includes technology, intellectual property, and the transition of nine Informal Systems employees to Circle. Financial terms were not disclosed.

Malachite is built on the Tendermint consensus algorithm. It was designed as a flexible and secure solution for decentralised systems with a focus on performance.

Malachite will remain an open-source project under the Apache 2.0 license. Developers can freely use and refine the technology. Informal Systems will continue to support other uses of the engine and develop its projects, including tools for cross-chain infrastructure.

Implications of the GENIUS Act

Circle is launching Arc amid clarifying stablecoin regulations in the US following the enactment of the GENIUS Act. The document establishes federal rules for stablecoins, requiring issuers to fully back their reserves with US dollars or similar liquid assets. Companies with capitalisation over $50 billion are subject to annual audits.

In line with the GENIUS Act’s requirements, the US Treasury is seeking new ways for financial institutions to combat illicit activities in the industry.

Today, Treasury issued a Request for Comment required by the GENIUS Act, which furthers the Administration’s policy of supporting the responsible growth and use of digital assets, as outlined in President Trump’s Executive Order on “Strengthening American Leadership in Digital…

— Treasury Department (@USTreasury) August 18, 2025

The regulator has begun collecting public suggestions.

The department is interested in APIs, artificial intelligence, digital identity verification, and the use of blockchain to detect suspicious activity.

Treasury Secretary Scott Bessent stated that stablecoins will expand dollar access for billions and increase demand for US Treasury bonds.

Implementing the GENIUS Act is essential to securing American leadership in digital assets.

Stablecoins will expand dollar access for billions across the globe and lead to a surge in demand for U.S. Treasuries, which back stablecoins.

It’s a win-win-win for everyone involved:… https://t.co/p5nRQpBfnw

— Treasury Secretary Scott Bessent (@SecScottBessent) August 18, 2025

After collecting opinions, the department will analyse the information and submit the results to Senate and House committees. This could lead to the development of new rules. Proposals are accepted until October 17.

Some banking associations are concerned about the law. They believe the ban on paying interest to stablecoin holders is too weak. In their view, exchanges and brokers can easily circumvent this restriction, turning assets from a means of payment into a savings and lending tool.

TD Cowen analyst Jaret Seiberg believes that banks’ concerns are justified. He compared the situation to the 2008 financial crisis when people massively transferred funds to money market funds under government guarantees.

“We believe that capital outflows to stablecoins will pose a greater threat because for consumers it will be a quick and easy way to convert deposits,” said Seiberg.

Earlier, Ripple agreed on the acquisition of the Rail platform, specialising in stablecoin operations.