Circle Brings USDC Liquidity to Bitcoin with New DABB Service
Circle has expanded its Circle Mint platform by introducing Digital Asset-Backed Borrowing (DABB), allowing eligible institutions to borrow USDC against Bitcoin without selling their BTC. This new service uses cirBTC as collateral through supported lending markets on Arc and Ethereum, with Morpho being the first integrated lending protocol.
The launch follows the debut of Arc Mainnet on September 16, extending Circle's institutional infrastructure around USDC, payments, and on-chain financial services. Native Bitcoin cannot directly interact with smart contracts, making it difficult to use in on-chain lending. Under DABB, customers deposit BTC and mint cirBTC, then choose a supported third-party lending market, provide cirBTC as collateral, and borrow USDC.
The borrowed stablecoin is credited to the customer's Circle Mint balance, and repaying the USDC releases the collateral. Circle said positions are overcollateralized, with interest rates, collateral requirements, liquidation thresholds, available liquidity, and other terms set by the selected lending market. This means the cost and structure of each position depend on the market being used rather than a single fixed Circle borrowing rate.