Circle USDC borrowing hits $14.3M on Arc, backed by 287 cirBTC

Circle’s new bitcoin-backed borrowing product on Arc reached $14.3 million in USDC borrowings by 2 p.m. UTC on Sept. 21, secured by 287 cirBTC, according to Morpho data cited by The Defiant. The product, effective Sept. 16, allows institutional Circle Mint clients to post wrapped bitcoin as collateral to borrow stablecoins, with the loan terms and liquidation mechanics controlled by Morpho’s contracts rather than Circle.

Borrowing volume climbed from $1.37 million early on Sept. 17 to $10.2 million on Sept. 19, The Defiant reported. As of 4:10 p.m. ET Monday, the market held $177 million of supplied USDC against the $14.3 million in borrowings, resulting in an 8.1% utilization rate. The 287 cirBTC collateral was valued at $24.8 million. Morpho’s terms state that a position “may be liquidated automatically” as determined by the protocol operator “and not by Circle.”

Galaxy USDC and Keyrock Prime USDC vaults hold $76.7 million and $75 million respectively, supplying almost all the USDC in the market, per Morpho data. Galaxy Curation is deploying an institutional risk framework across its $1.4 billion average loan book, which Marius Ciubotariu, Co-Founder of Kamino, noted provides direct access to that expertise through USDC and USDT vaults on Solana, according to a Galaxy newsroom post. LlamaRisk’s assessment for Aave flagged concentrated liquidity with Circle as the primary liquidity provider on a single venue.

The Defiant reports that the cirBTC market on Arc now holds $14.3 million of USDC borrowed against 287 cirBTC, a sharp increase from the $1.37 million recorded on Sept. 17. According to The Defiant, LlamaRisk's assessment "flags concentrated liquidity, with Circle as the primary liquidity provider on a single venue, and access controls held by an externally owned account without timelocks." The Defiant reported on Aug. 12 that cirBTC had about 40 bitcoin outstanding after its Ethereum launch. Galaxy is bringing the institutional risk framework used across its $1.4 billion average loan book to Kamino, giving users direct access to that expertise through USDC and USDT vaults on Solana,” said Marius Ciubotariu, Co-Founder of Kamino, as the Federal Reserve's next rate decision is scheduled for October 28, 2026.