Arc's DABB Mechanism Surges to $150M in USDC Borrowing Against cirBTC

Arc's Digital Asset-Backed Borrowing (DABB) mechanism has reached a milestone of $150 million in USDC borrowed against cirBTC, with borrowing activity exploding from $1.37 million at launch to over $90 million within just a few days.

The DABB framework allows institutions to deposit Bitcoin, mint cirBTC (a token backed 1:1 by actual BTC held in segregated custody), and then borrow USDC against that cirBTC collateral without selling their Bitcoin.

Circle has branded this framework as Digital Asset-Backed Borrowing (DABB) and restricted access to eligible Circle Mint clients. Early market data shows an 86% liquidation loan-to-value ratio, meaning borrowers are operating with relatively tight risk parameters.

The presence of Galaxy Digital and Keyrock as early liquidity providers, seeding the markets that make borrowing possible, has contributed to the rapid growth. Aave has also launched specialized markets on Arc, creating a competitive lending environment from day one.