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Stablecoin Issuer Circle Rolls Out Cross-Chain Transfer Protocol (CCTP)

Stablecoin Issuer Circle Rolls Out Cross-Chain Transfer Protocol (CCTP)

Circle's new Cross-Chain Transfer Protocol removes the need to bridge USDC "via traditional lock-and-mint approaches." 

Circle, the stablecoin issuer behind USD Coin (USDC), has introduced a Cross-Chain Transfer Protocol (CCTP) to transfer USDC between Ethereum and Avalanche networks.

The brand-new CCTP, unveiled on April 26th, eliminates the need for USDC bridges, streamlining the transfer process for users.

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Previously, those wanting to move their USDC from Ethereum to Avalanche had to go through a Circle partner or use third-party bridges.

However, Circle's newest development is designed to eliminate this need. In contrast to conventional bridges that lock tokens, CCTP eliminates tokens on the sending network and mints new ones on the receiving end. Users can then directly convert these new tokens into bank deposits by working with Circle or its partners.

According to Circle, CCTP aims to tackle the "fragmentation" issue in the Web3 ecosystem. The company highlighted that there are several unofficial versions of USDC circulating across multiple networks.

Circle expects that the introduction of CCTP should gradually reduce the usage of these unofficial versions, simplifying the overall USDC experience.

Major cross-chain protocols have already committed to adopting CCTP, including companies like Celer, Hyperlane, LayerZero, LI.FI, MetaMask, and Wormhole.

Joao Reginatto, Circle's VP of Product, believes that the innovative protocol will enhance liquidity and capital efficiency within the decentralized finance space. When commenting on the new project, Reginatto noted:

CCTP helps to solve today's DeFi liquidity and capital inefficiency issues due to the risks and fragmented nature of bridged assets. With CCTP, developers can simplify the user experience and their users can trust that they are always transacting with a highly liquid, safe and fungible asset in native USDC. This milestone makes USDC a natively multi-chain digital dollar.

Circle's Cross-Chain Transfer Protocol is set to revolutionize USDC transfers between Ethereum and Avalanche, simplifying the process and fostering a more seamless user experience.

In other Circle-related news, the company's CEO claims that the crackdown on cryptocurrencies by US regulators is the main reason behind the decreasing market capitalization of USD Coin.

Gile K., Market Sentiment Analyst
Gile is a Market Sentiment Analyst who understands what public events may form what emotions. Her experience researching Web3 news and public market messages – including cryptocurrency news reports, PRs, and social network streams – is critical to her role in helping lead the Crypto News Editorial Team.
As an intelligent professional in public relations, together with the team, she aims to determine real VS fake news patterns, and bring her findings to anyone searching for unbiased news and events happening in the FinTech markets. Her expertise is uncovering the latest trustworthy & informative Web3 announcements to the masses.
When she's not researching the trustworthiness of mainstream stories, she spends time enjoying her terrace view and taking meticulous care of her outdoor environment.

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