Circle, the issuer of the US dollar-pegged stablecoin USD Coin (USDC), is set to end support for USDC on the TRON blockchain. Circle announced its decision via X:
Circle stated that the decision is part of a strategic effort aimed at ensuring the continued trustworthiness and transparency of USDC. In its extended blog post, Circle announced the immediate cessation of USDC minting on the TRON network.
This move comes amidst Circle's filing to go public in the US, highlighting the significance of its USDC stablecoin and its role in mainstreaming cryptocurrency. As of this week, USDC boasted a market capitalisation of USD $28 billion (approximately AUD $43 billion) according to CoinMarketCap, which, as a stablecoin, is second only to Tether (USDT).
While no explicit rationale was provided by Circle for withdrawing its support of TRON, Circle emphasised its ongoing evaluation of blockchain network suitability within its risk management framework. Circle reassured that its commitment to growing USDC "remains steadfast" and that it aims to continue expanding USDC's reach to additional blockchain networks.
Founder of TRON, Justin Sun, and several of his companies, were sued by the SEC in March 2023 for alleged fraud and other securities law violations. Several high-profile celebrities were also caught up in the scandal for alleged "illegal touting" of the native TRX token, including Lindsay Lohan, Akon, Soulja Boy, and Jake Paul.
Following allegations linking Circle to TRON founder Justin Sun, Circle clarified late last year that it had severed its ties with Sun's group in February 2023, prior to the SEC action. The open letter followed claims from the "Campaign for Accountability" ethics group, that Circle's relationship with TRON compromised the integrity of USDC. The Campaign for Accountability referenced TRON's alleged involvement in international regulatory enforcement actions, concerning significant financial sums and transactions by alleged organised crime groups and internationally sanctioned entities.
Since Circle's recent announcement, Justin Sun has taken to X to post his thoughts:
Circle's decision to discontinue USDC support on TRON reflects the heightened pressure on the crypto industry over AML/CTF compliance, as its enter tighter integration with traditional markets. Meanwhile, Circle's preparations for its debut in public securities markets would be appear to be continuing apace.
Written by Luke Higgins and Steven Pettigrove