Arbitrum partners with Circle to integrate USDC for Orbit Chain gas fees

Arbitrum said it has collaborated with stablecoin issuer Circle to support the use of bridged USD Coin (USDC) as a custom gas token for Orbit Chains, according to an Aug. 7 statement shared with .

The Ethereum-based scaling solution stated that this development is part of a broader set of initiatives it is currently pursuing with Circle.

Arbitrum is the largest Ethereum Layer 2 blockchain network, with the total value of assets locked on it at $3.3 billion, according to DeFiLlama data,

The networks native ARB token hit an all-time low of $0.4317 on Aug. 5 amid a broader market decline that resulted in over $1 billion in liquidations.

Orbit Chain gas fees

Orbit Chains, introduced in March 2023, enable the creation of highly customizable networks with advanced throughput and governance features. Initially, these chains only accepted Ethereum for gas fees.

However, Arbitrum has allowed these Chains to use any ERC20 token as transaction fees since January.

This change has now been extended to Circles USDC, which the platform believes will significantly enhance transaction processes within its ecosystem while offering users greater convenience, price stability, and accessibility.

Why USDC？

Arbitrum explained that USDC‘s adoption streamlines payments, removing the need for multiple tokens for gas fees. As a stablecoin, USDC ensures more stable and predictable gas costs, mitigating concerns over ETH’s price fluctuations.

Additionally, the integration of USDC is expected to boost liquidity and accessibility by tapping into USDCs significant $1.6 billion supply on Arbitrum. This lowers entry barriers for projects developing on Arbitrum Orbit Chains and simplifies user interactions by removing the need for USDC conversions.

For builders, this move facilitates easier customization of Orbit Chains through Orbit RaaS providers, including platforms like Alt Layer, Caldera, Conduit, Gelato Network, Ankr, and Alchemy.

Moreover, it opens up opportunities for applying to Circles USDC Grant Program, which supports projects utilizing USDC as gas tokens.