Celo Integrates Circle's Stablecoin, Proposes Using USDC as Gas Fees

The deployment of USDC will help Celo, a layer-1 network currently transitioning to layer-2, accelerate its journey to becoming a blockchain hub for Real World Assets (RWA).

Celo integrates Circle's stablecoin, proposes using USDC as gas fees

Circle, the issuer of stablecoins like USDC and EURC, has announced plans to expand USDC operations onto Celo, a layer-1 blockchain that is undergoing a transformation to serve as a Layer-2 scaling solution for Ethereum.

The integration of USDC into the network comes as the Celo ecosystem aims to become a focal blockchain for tokenizing Real World Assets (RWA), facilitating cross-border payments, enabling local currency conversions, and supporting peer-to-peer transactions in developing regions.

In addition to token issuance, an upcoming governance vote organized by cLabs—the development team behind the Celo blockchain—will decide on formally adopting USDC as the primary gas fee on the network, replacing CELO.

Shamus Noonan, Business Development Director at Circle, shared thoughts on the integration:

"Circle is proud to join the Celo ecosystem, a blockchain renowned for providing fast, low-cost payment services worldwide. This partnership will help expand USDC's reach and leverage Celo's large mobile user base in regions with the highest blockchain adoption rates."

Launched in 2020, Celo employs a Proof-of-Stake consensus mechanism to minimize environmental impact. During the market growth phase in 2021, Total Value Locked (TVL) on the Celo network peaked at over $1 billion. However, after two years, this figure currently stands at $120 million.

TVL fluctuations on Celo, screenshot from DefiLlama at 10:10 PM on January 30, 2024

CELO's price has shown positive movements following the announcement of the Circle partnership but has yet to reclaim its early January 2024 high of $0.9.

4-hour chart of CELO/USDT pair on Binance at 10:35 PM on January 30, 2024