USDC To Expand Native Support To Base and Optimism
Deployments Come As USDC Seeks To Reverse Declining Market Share
By: Samuel Haig •DeFi News
USDC, the second-largest stablecoin, will natively expand onto top Ethereum Layer 2s Optimism and Base in the coming weeks.
On Aug. 29, Circle announced the stablecoin will deploy on Base, the recently launched L2 from Coinbase, next week. The following day, Circle said that native USDC will also go live on Optimism in September.
Circle emphasized that the new deployments will allow users to redeem USDC one-to-one for U.S. dollars and also offer an institutional on and off-ramp for the networks.
USDC tokens bridged over from Ethereum will trade under the USDbC ticker on Base and the USDC.e ticker on Optimism moving forward.
USDC Seeks To Shore Up Market Share
Circle said last week that USDC would natively launch across six new chains by November.
USDC has suffered from declining adoption over the past year, with USDC’s market cap shrinking 53.5% from a record high of $56B last June to $26B today. Although USDC has held onto its position as the second-largest stablecoin by market cap and trade volume, Circle hopes expanding the stablecoin onto new chains can reverse USDC’s shrinking market dominance.
Base Enjoys Early Success
Base stood out as the most likely candidate for a native USDC deployment after Coinbase revealed it had invested in Circle last week.
Coinbase’s highly-anticipated Layer 2 did not disappoint with its Aug. 9 general access launch. The network quickly emerged as the most active Layer 2, processing a high of nearly 16 transactions per second (TPS) on Aug. 21, according to L2beat. However, on-chain activity has since dropped by three-quarters, with Base currently ranking fifth among L2s by throughput with 4.25 TPS.
Base was built using the OP Stack, Optimism’s open-source framework for deploying L2s. Optimism and Base inked a revenue-sharing deal last week, with Optimism set to receive either 15% of Base’s gross profits or 2.5% of total sequencing revenue — whichever is greater.
In exchange, Base has the opportunity to earn up to 2.75% of the OP token’s supply to participate in Optimism and Superchain governance. Optimism transferred an initial OP token grant to Base on Aug. 30.