Jeremy Allaire Pitches Circle's Arc as Money for Machines

Regulators changed the plan, in Allaire's telling. Chains that banks use would have to meet set standards, regulators said, so Circle built its own¹. “But then it became very clear that the primary users, the primary deployers of software, and the primary entities that were going to be running on this were going to very likely be AI,” he said.

Allaire hedged on the next five years. “The honest answer is no one has any idea at this point,” he said¹. Then he predicted an "extraordinary amount of the work" would be "primarily operated by these AI machines".

“And I think, to Jeremy's point, it's very plausible that the vast majority of internet participants will be machines, and it seems natural that those machines would have economic components to what they do,” Dixon said¹.

The Interviewer's Firm Led Arc's Token Sale

Dixon alluded to the stake in his first answer. “The most important thing when we make an investment is the team Jeremy's built,” he said¹.

A Form 8-K that Circle filed May 11 names one a16z crypto investment in Arc². On May 8, 2026, Circle agreed to sell 740 million ARC tokens to investors led by a16z crypto. Each token cost $0.30. That came to about $222.0 million and a $3 billion value for the whole network.

Buyers can seek their money back if Arc misses a move to proof of stake by May 8, 2028, the filing says². Circle's first-quarter report named other buyers, including BlackRock, ICE, SBI Group, Haun Ventures and Standard Chartered Ventures⁵.

Andreessen Horowitz states its own position plainly. “As for its investments in any cryptocurrency or token project, a16z is acting in its own financial interest, not necessarily in the interests of other token holders,” its disclosures page says³.

Circle's Stablecoin Numbers, Checked

Several of Allaire's claims can be checked against the record.

Start with volume. “So we mint and redeem $150 billion a quarter of this, and it's plugged into all of these banking systems globally,” Allaire said¹. Circle minted $73 billion of USDC and redeemed $72 billion in the first quarter of 2026, its results show⁵. In the second quarter it minted $83 billion and redeemed $87 billion⁶. Those pairs add up to $145 billion and $170 billion. His round number sits between them.

Next comes the bridge. Allaire called Circle's Cross-Chain Transfer Protocol, CCTP, "the most widely used interoperability protocol in the world right now"¹. Circle's docs say CCTP moves USDC between chains by burning it on one and minting it on the other⁷. The docs list 31 blockchains, Arc among them⁸. Allaire said assets issued on Arc can now use CCTP too. Circle's docs confirm it carries EURC and "registered third-party assets". That ranking stays Allaire's claim.

Then there is the market. “And I think what we like to say is the stablecoin market is a winner-take-most market structure, not a winner-take-all market structure,” Allaire said¹. By circulation, Tether leads. USDT had $183.36 billion in circulation at 16:32 UTC on Oct. 17, 2026, DefiLlama showed¹⁰. USDC had $72.65 billion. Circle's own count two minutes later read $72.57 billion⁹.

USDC has shrunk since March. Circle reported $77.0 billion at the end of March⁵ and $73.3 billion at the end of June⁶. By its own measure, USDC held 27% of large, attested, fiat-backed dollar stablecoins at the end of June. On June 30, Circle held $73.16 billion in cash and cash equivalents set aside for stablecoin holders, unaudited.

Allaire also pointed to deep USDC trading on Binance, Coinbase and Hyperliquid¹. Circle pays Binance to promote USDC¹¹. On Sept. 17, 2026, Circle agreed to pay Binance a monthly fee tied to USDC held through a Circle wallet service, a filing says.

A last claim rests on Circle's word alone. Allaire said Circle has "the largest, I believe, currently, tokenized treasury and money market product"¹. Circle made the same claim for its USYC fund in May⁵.

Vetted Validators and a "Credibly Neutral" Promise

Allaire's case for Arc rests on who runs it. “Obviously, one of the things that's a little bit different about Arc is that in order to operate the infrastructure of the network and to run ultimately what will be like staking validation nodes on the network, you actually have to meet high standards for operations, information security, compliance, and other areas,” he said¹.

Those standards help Arc settle "in a fraction of a second," he said¹. “It actually needs to be something that is credibly neutral vis-à-vis the stakeholders that run the infrastructure and that ultimately govern the infrastructure. That's one of the covenants that we've made,” Allaire said.

Circle names 11 founding validators, set to join in a phased rollout⁴. The 11 are BlackRock, DTCC, Galaxy, ICE, Mastercard, MoneyGram, SBI Group, Standard Chartered, Sumitomo Corporation, Visa and Worldpay, now Global Payments. Arc uses proof of authority, meaning a fixed list of approved firms confirms its blocks. Circle says it is exploring a move to proof of stake in 2027.

Some validators also signed up to buy the token. BlackRock, ICE and SBI Group appear on Circle's validator list and on its named list of ARC buyers⁴⁵. Standard Chartered is a founding validator, and its venture arm signed up as a buyer. Circle's list of buyers leaves the other seven validators unnamed.

BlackRock backs the design. Robbie Mitchnick, its global head of digital assets, said “Arc appears clearly well positioned to serve stablecoin and payment use cases at scale”⁴.

Adam Cochran, then a partner at the venture firm Cinneamhain Ventures, made the case against Arc when Circle announced it in August 2025¹³. “They can't make it a true L1 when using USDC as the root token, because there are never economic incentives to be a faithful validator, and that's why they have to make it a private consortium,” Cochran wrote on X¹². He closed on the industry's purpose: “This industry was built to fix that in peer-to-peer systems, not by just building new banks”.

Cochran's point lands on the fee token, and Arc fees are paid in USDC⁴. ARC is meant to carry security and governance on Arc, Circle's release says. Circle minted 10 billion ARC in September and called the mint "not a commitment to publicly launch ARC".

Fly Brains, AI Jurors and $657 Million

Hackett asked for the strangest thing built on Arc so far. Allaire named Fly Brain, a project he had seen days earlier¹. “They basically took all of this neurological information about the brains of flies, the real actual computational rules of fly brains,” he said.

The team turned it into 16 megabytes of code that runs on Arc, Allaire said¹. He said he had yet to learn who built it or how its token works. “And maybe it's just a scam. But it's indicative of what happens when AI is combined with these computer networks and economics: people are starting to try really different things,” Allaire said.

He also described a project coming to Arc that settles disputes over AI work. “But it's designed to basically deal with the fact that AI will hire other AI, and humans will hire other AI for work, and you need arbitration,” he said¹. The CryptoLately.com Desk reports both projects only as Allaire described them.

Arc held $657 million of USDC at 16:34 UTC on Oct. 17, 2026, Circle's own data showed⁹. That is 0.9% of the $72.57 billion in circulation. DefiLlama counted $656.5 million on Arc the same hour¹⁴.

Ethereum carried $48.04 billion, Solana $6.72 billion and HyperEVM $6.52 billion⁹. Base held $4.42 billion and Arbitrum $2.71 billion, Circle's data showed.

By the numbers

• $222.0 million: ARC presale proceeds, for 740 million tokens at $0.30 each, in a round led by a16z crypto².
• $170 billion of USDC was minted or redeemed in the second quarter of 2026, Circle reported⁶.
• USDT circulation reached $183.36 billion at 16:32 UTC on Oct. 17, 2026, against $72.65 billion for USDC¹⁰.
• Arc's USDC balance stood at $657 million at 16:34 UTC on Oct. 17, 2026⁹.
• May 8, 2028 is the deadline for Arc's move to proof of stake before ARC buyers may seek repayment².

What to watch

Watch Circle's third-quarter results on Nov. 4, 2026, for mints and redemptions beside Allaire's $150 billion¹⁵. Track Arc's USDC balance in Circle's supply data, where growth from $657 million would show money arriving⁹. A dated move to proof of stake, or validators added to the founding 11, would give Allaire's "credibly neutral" covenant its first real test¹⁴.

Sources

1. a16z crypto, "Money for machines," a16z crypto, Oct. 17, 2026, https://a16zcrypto.substack.com/p/money-for-machines-circle-ceo-jeremy
2. Circle Internet Group, "Circle Internet Group, Inc., Form 8-K, Item 8.01, ARC token purchase agreements," SEC EDGAR, May 11, 2026, https://www.sec.gov/Archives/edgar/data/1876042/000187604226000148/crcl-20260511.htm
3. Andreessen Horowitz, "Disclosures," accessed Oct. 17, 2026, https://a16z.com/disclosures/
4. Circle, "Circle Launches Arc Mainnet, an Economic Operating System for the Internet," Sept. 16, 2026, https://www.arc.network/pressroom/circle-launches-arc-mainnet-an-economic-operating-system-for-the-internet
5. Circle Internet Group, "Circle Reports First Quarter 2026 Results (Exhibit 99.1)," SEC EDGAR, May 11, 2026, https://www.sec.gov/Archives/edgar/data/1876042/000187604226000148/final_05x11q1epr30.htm
6. Circle Internet Group, "Circle Reports Second Quarter 2026 Results (Exhibit 99.1)," SEC EDGAR, Aug. 5, 2026, https://www.sec.gov/Archives/edgar/data/1876042/000187604226000246/augustepr-circle_q22026f.htm
7. Circle Docs, "Cross-Chain Transfer Protocol," accessed Oct. 17, 2026, https://developers.circle.com/cctp
8. Circle Docs, "Blockchains and domain identifiers supported by CCTP," accessed Oct. 17, 2026, https://developers.circle.com/cctp/cctp-supported-blockchains
9. Circle, "USDC and EURC supply by chain (stablecoins API)," read 16:35 UTC, Oct. 17, 2026, https://api.circle.com/v1/stablecoins
10. DefiLlama, "Stablecoins circulating supply (stablecoins API)," read 16:32 UTC, Oct. 17, 2026, https://stablecoins.llama.fi/stablecoins?includePrices=true
11. Circle Internet Group, "Circle Internet Group, Inc., Form 8-K, Item 8.01, Binance arrangements and private placement," SEC EDGAR, Sept. 22, 2026, https://www.sec.gov/Archives/edgar/data/1876042/000187604226000276/crcl-20260917.htm
12. Adam Cochran, "This isn't an L1 and its offensive to call it such.," post on X, Aug. 12, 2025, https://x.com/adamscochran/status/1955257074318823568
13. Oluwapelumi Adejumo, "Circle to launch L1 blockchain called Arc sparking concerns over centralization and governance," CryptoSlate, Aug. 12, 2025, https://cryptoslate.com/circle-to-launch-l1-blockchain-called-arc-sparking-concerns-over-centralization-and-governance/
14. DefiLlama, "USD Coin chain balances (stablecoins API)," read 16:39 UTC, Oct. 17, 2026, https://stablecoins.llama.fi/stablecoin/2
15. Circle, "Circle to Announce Q3 2026 Financial Results on November 4, 2026," Oct. 7, 2026, https://www.circle.com/pressroom/circle-to-announce-q3-2026-financial-results-on-november-4-2026