Circle has officially integrated USDC, the second-largest stablecoin by market cap, into the Polkadot ecosystem. With USDC being natively accessible on Polkadot’s Asset Hub, every parachain within the ecosystem has seamless access to this stablecoin.
Polkadot announced the Circle’s groundbreaking move to eliminate the need for bridges to access the popular digital asset via a Twitter thread:
This integration not only enhances liquidity within the Polkadot network but also facilitates easier institutional entry into the ecosystem. The announcement specified that users must return to Polkadot Asset Hub via XCM after sending USDC to other parachains via XCM before making a deposit into their Circle Account, stating:
Please do not attempt to deposit XCM-transferred USDC from a parachain other than Polkadot Asset Hub to your Circle Account, as it may not be recoverable and could result in a loss of funds.
USDC is quickly gaining popularity among various Polkadot parachains, with Centrifuge, a significant participant in the Polkadot ecosystem, which is set to adopt it as the native currency for its liquidity pools. This move will empower Centrifuge users to finance assets with both DAI and USDC, diversifying financing opportunities and simplifying fiat on/off ramps.
Lucas Vogelsang, the co-founder of Centrifuge, commented on the above stating:
We are excited to see USDC natively on Polkadot. It is an important step for DeFi, and an even bigger one for the Real World Assets ecosystem that Centrifuge is building.
InterlayHQ highlights three key use cases for USDC on its network, including collateral for iBTC, the wrapped Bitcoin token, within the Interlay Vault. It also envisions USDC lending and borrowing operations within the Interlay DeFi Hub and participation opportunities for DeFi enthusiasts through liquidity pools.
Polkadot operates as a network of sovereign blockchains, or parachains, that operate in parallel, ensuring faster transactions while maintaining overall security and decentralization. Polkadot Asset Hub serves as a common-good parachain dedicated to issuing, managing, and transferring digital assets across the Polkadot ecosystem. USDC is natively issued on Polkadot Asset Hub, streamlining transfers to parachains via XCM.
Developers and users can access Polkadot USDC through Circle Account and Circle APIs, simplifying transfers to parachains via the XCM protocol. The integration allows for global low-cost payments and remittances in seconds. It also enables 24/7 trading, borrowing, and lending on parachains like Centrifuge, HydraDX, and Moonbeam.
In response to this announcement, Aaron Evans, Director of the Moonbeam Foundation, stated that USDC will help foster a more sophisticated and mature DeFi ecosystem. They couldn’t be more excited to support the launch and see this natively-minted stablecoin become a vital resource for the many dapps on the Moonbeam parachain.
