Circle, the company behind the widely used USD Coin ($USDC), has announced it will cease supporting the stablecoin on the Tron blockchain. This decision was said to be part of the company’s ongoing efforts to maintain the trust, transparency, and safety of $USDC.
Immediate changes and user guidance
Effective immediately, Circle will stop minting USDC on the Tron blockchain ($TRX), according to a recent press release. It added: “Circle is discontinuing support for USDC on the TRON blockchain in a phased transition”.
The company is advising retail users and non-Circle customers who currently hold $USDC on Tron to transfer their tokens to exchanges where $USDC is supported. This move facilitates the conversion or transfer of %USDC to other blockchains that continue to have Circle’s backing.
For Circle Mint customers, the company is providing options to either transfer their $USDC from Tron to other supported blockchains or redeem it directly for fiat currency through Circle. This phased transition aims to minimise disruption for $USDC users and maintain the stablecoin’s reputation as a secure and reliable digital currency.
Circle’s motivation
While Circle did not give a specific reason for its decision, it said that it made the move as “part of our risk management framework”.
It added: “Our decision to discontinue support for $USDC on TRON is the result of an enterprise-wide approach that involved the business organisation, compliance and other functions across our company.”
Circle said this strategic move aligns with its commitment to upholding the highest standards of trust, transparency, and safety for $USDC users.
The move comes at a time when Circle is preparing to go public in the United States, with its $USDC stablecoin boasting a nearly $28 billion market capitalisation, second only to Tether in the stablecoin market.
Circle’s decision may also be a strategy to distance itself from the Tron blockchain. Circle has previously addressed claims related to its association with Tron founder Justin Sun, emphasising its stance on not providing services to Sun since early 2023.
Tron “has been named in multiple international law enforcement actions involving billions of dollars in transactions by alleged organised crime groups and sanctioned entities,” according to the Campaign for Accountability group.
The Tron blockchain and Sun were even sued by the US Securities and Exchange Commission (SEC) last year, after allegations of unregistered securities and manipulative trading. Sun has denied these claims.
Despite ending support on the Tron blockchain, Circle remains bullish on the future of $USDC.
Circle concluded its statement saying: “We will continue to grow $USDC and expand its reach to additional blockchains to deliver the widest access, broadest developer choice, and most secure user experience of any dollar stablecoin in the world.”
