Circle, a stablecoin issuer, has introduced the USDC stablecoin into the Polkadot ecosystem of parachains. This move signifies a significant extension of the accessibility of this dollar-backed stablecoin across different blockchain networks.
As detailed on Circle’s official website, developers and users can now readily access Polkadot USDC. That means the stablecoin can be seamlessly transmitted to parachains within Polkadot by leveraging the XCM protocol through Circle Account and Circle APIs.
The Polkadot USDC is inherently generated on the Polkadot Asset Hub, a shared parachain dedicated to creating, administrating, and moving digital assets within the Polkadot network.
Circle explicitly emphasizes that its Circle Account and Circle APIs exclusively facilitate transactions involving Polkadot USDC that have been originally issued on the Polkadot Asset Hub within the Polkadot ecosystem. That means users must transfer USDC from their Circle Account to an external wallet address within the Polkadot Asset Hub before engaging in transactions via the XCM protocol.
Additionally, Circle stated that when moving USDC from the Polkadot Asset Hub to other parachains through XCM, it is imperative to conduct a transfer back to the Polkadot Asset Hub via XCM before depositing it into the Circle Account. Circle strongly advises against attempting to deposit XCM-transferred USDC from a parachain other than the Polkadot Asset Hub into a Circle Account, as this may lead to irrecoverable loss of funds.
This integration of Polkadot support for USDC marks another milestone in expanding the U.S. dollar-pegged stablecoin. With this recent inclusion, USDC now extends its support to 14 diverse blockchain networks, encompassing Ethereum, Tron, Stellar, Solana, and others.
Like its previous blockchain integrations, Circle’s incorporation with Polkadot aims to solidify its position as a leading interoperable stablecoin while enabling cost-effective payment solutions. This expansion into Polkadot’s ecosystem brings forth functionalities like trading, borrowing, and lending on parachains such as Centrifuge, HydraDX, and Moonbeam.
Polkadot, established in 2020, constitutes a network of distinct, independent blockchains known as parachains, which operate concurrently to facilitate swift transactions. These parachains benefit from the overarching security and decentralization the Polkadot network provides.
It’s worth noting that the number of blockchains supported by USDC has now surpassed that of its rival stablecoin, USDT, which currently operates on 11 networks. In August 2023, the issuer of USDT, Tether, ceased the creation of the stablecoin on three blockchains, including Bitcoin Omni Layer, Bitcoin Cash, and Kusama, citing a lack of user interest as the primary reason for this decision.