Circle ceased minting USDC stablecoins on the Tron network due to the need to comply with regulatory requirements. Meanwhile, Tether released a transparency report showing that more than half of USDT are minted on Tron.
Circle announced that it’s no longer supporting the Tron blockchain network. The minting of USDC stablecoins is now discontinued. Users can transfer their holdings to other blockchain networks or exchange them for fiat via Circle Mint until February 2025.
The company cited the need to ensure that USDC remains trusted, transparent, and safe as the official reason for abandoning the network, hinting that the Tron blockchain doesn’t meet these requirements. Company officials also emphasized that their risk management system continuously evaluates the suitability of all blockchains supported by Circle.
Remarkably, Circle’s statement also indicated that the decision to stop supporting USDC on the Tron network was “the result of an enterprise-wide approach.” That is, the decision was made by a majority of the board of directors who decided to file for an initial public offering (IPO) in the U.S. in January.
Obviously, Circle’s withdrawal of support for the Tron blockchain network is directly related to its desire to become a public company. Before filing with the Securities and Exchange Commission (SEC), the company was accused of aiding and abetting terrorism and money laundering. The Campaign for Accountability (CfA), a non-profit ethics group, in a letter to U.S. senators alleged that Circle had ties to the Tron Foundation and its Founder Justin Sun. In the same letter, Michelle Kuppersmith, Executive Director of the CfA, stated that transactions made by criminal groups and sanctioned entities flow through the Tron network. Dante Disparte, Chief Strategy Officer and Head of Global Policy at Circle, denied the allegations and any connection to Justin Sun, the Tron Foundation, or Huobi Global.
In a public statement, Circle emphasized that the accounts of Sun and his subsidiaries were closed in February 2023, although the U.S. government didn’t officially list Tron’s Founder as a “special category” citizen. Sun has one open case against him, the SEC’s charge of distributing unregistered securities and trade manipulation.
In the context of Circle’s complete renunciation of any affiliation with Tron, it’s worth noting that Tether, the company’s main competitor in the stablecoin market, apparently has no plans to stop supporting the network. According to the latest transparency report, Tron has over 51.8 billion USDT on its network, which is more than half of all minted tokens. In 2023, about 13 billion new USDT were issued on the Tron network.
Tether will continue to support Tron, even after UN analysts identified USDT of the TRC-20 standard as the most popular digital asset among representatives of the shadow economy in Southeast Asia.
Tether representatives rejected the UN accusation, pointing out that the organization lacks the necessary knowledge of blockchain technologies to make such accusations.
