Arc Sees $90M in USDC Borrowed Against Wrapped Bitcoin

Circle's Arc blockchain has seen significant borrowing activity in its early days. In just three days, institutional borrowers have pulled more than $90 million in USDC against deposits of cirBTC, a wrapped Bitcoin token. This figure represents a dramatic acceleration from the chain's earliest hours, when borrowing volumes started at around $1.37 million shortly after cirBTC went live on September 21.

The mainnet launched around mid-September 2026, and cirBTC followed on September 21 as the chain's first major financial primitive. The token is backed 1:1 by Bitcoin held at Circle National Trust, with reserves verifiable on-chain through Chainlink Proof of Reserve.

The borrowing process works through what Circle calls Digital Asset-Backed Borrowing, or DABB. Eligible Circle Mint clients deposit BTC, mint cirBTC against it, supply that cirBTC to a lending market on Morpho Blue, and then borrow USDC that settles directly to their Mint balance. Loan-to-value ratios are set by the lending protocol itself, not by Circle.

Two names keep appearing on the supply side of these markets: Galaxy and Keyrock. Both firms have been acting as primary liquidity providers to the cirBTC/USDC lending pools on Morpho Blue, which helps explain why borrowing capacity scaled so quickly.