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The first reserve-yield payment awaits transfer to the Assistance Fund, adding buyback funding tied to USDC balances rather than trading volume.

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Hyperliquid, a perpetuals exchange and protocol, has received $14.6 million in USDC yield intended for HYPE token buybacks. This payment will be transferred to Hyperliquid’s Assistance Fund, which is designed to buy back and burn HYPE, enhancing the token’s value proposition. The yield stems from AQAv2, a mechanism that allocates about 90% of cost-adjusted USDC reserve yield on the platform to the fund, supplementing fee revenue. This additional financial backing could influence market sentiment, potentially supporting future price increases for the HYPE token.

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Key Takeaways The transfer of $14.6 million in USDC yield to Hyperliquid’s Assistance Fund suggests strong financial backing for HYPE buybacks. Market pricing indicates positive sentiment, reflected in the 68% YES probability for Hyperliquid reaching $100 by year-end 2026. The AQAv2 mechanism adds a recurring buyback source, which could be consistent with scenarios where the HYPE token’s value is supported. What to Watch Market participants will likely monitor Hyperliquid’s future financial updates and the fund’s buyback activities. The price movement of the HYPE token could be influenced by further announcements regarding partnerships or technological advancements. Observers should also watch for any developments that could affect the market’s current supportive stance towards the HYPE token reaching $100 by December 31, 2026.

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Term Structure

Contract Odds Δ since publish Volume 24h December 31 68% — — View market → January 1 2027 2.4% — — View market → January 1 2027 1.9% — — View market → January 1 2027 2.8% — — View market → January 1 2027 2.1% — — View market → January 1 2027 5.5% — — View market → January 1 2027 3.9% — — View market → January 1 2027 5.5% — — View market → January 1 2027 9.5% — — View market → January 1 2027 10.5% — — View market →

In brief The Ethereum Foundation and the Open Anonymity Project announced zkAPI on Ethereum mainnet on October 1, letting users prepay in USDC and receive capped, short-lived API keys through zero-knowledge proofs. The design follows a February 2026 Ethereum Research proposal by Davide Crapis, who leads the foundation's dAI team, and Vitalik Buterin. The project's repository labels the protocol experimental, and its documentation points to OpenRouter as the AI provider behind the keys. The Ethereum Foundation has put zkAPI live on Ethereum's main network, a system that lets people pay for AI services without tying their identity to what they ask, according to the Ethereum Foundation's announcement.

“Prompts are personal. People ask AI models about their health, their finances, their doubts. Under the current model, using AI means handing a running transcript of your thinking to whoever holds the billing relationship,” the Ethereum Foundation argued.

Myriad: Where does Ethereum go next? Click to make your prediction.“zkAPI separates payment from identity,” the Foundation continued. “You deposit credits (ETH, USDC, etc.) into a vault contract on Ethereum, one ordinary transaction. From then on, your balance exists as a private note: digital cash that only you can spend and that nobody can trace back to the deposit.”

It was built with the Open Anonymity Project. Alongside the launch comes OA Chat, a browser-based private chatbot that needs no installation, and the code is open on GitHub.

The concern over privacy in the AI space isn't an abstract one. In May 2025, a federal court ordered OpenAI to preserve its output logs, including chats users had deleted, in a copyright lawsuit brought by The New York Times and other publishers.

With this implementation, every time you want to ask an AI something, software on your device builds a zero-knowledge proof—a mathematical receipt that proves a fact without showing the details behind it. This one proves you have enough funds and haven't already spent them.

The server checks the proof and hands back a temporary API key, which is basically a password that lets software talk to an AI service. The key is capped at a dollar amount and lives only in your device's memory.

Your requests then go to the AI provider with that key and nothing else. No name, no payment details.

When the key expires, the provider issues a signed usage receipt and you're charged for what you actually used, not the cap. The provider sees what you asked, the payment layer sees what you spent, and neither can link the two.

The project's documentation describes short-lived keys that work with OpenRouter, a service that gives access to hundreds of AI models through one connection. Any app that speaks the OpenAI format can plug in by pointing at a local address.

The idea comes from a proposal Davide Crapis and Vitalik Buterin posted on Ethereum Research in February. Crapis leads the foundation's dAI team, which aims to make Ethereum the preferred settlement and coordination layer for AIs.

He had already pitched Ethereum as plumbing for software agents. In August 2025, Crapis and Marco De Rossi proposed the ERC-8004 standard, a shared rulebook that lets autonomous AI agents find each other, verify identity and transact. Crapis predicted most Ethereum traffic would come from machines within three to five years.

Buterin ran the same thread. On February 10, he had laid out an Ethereum-AI roadmap that included zero-knowledge payments for private API use.

In April, he showed the other path: running an open-source model locally on his own Nvidia 5090 graphics card instead of feeding his life to cloud services. Local models keep your data at home. zkAPI covers the case where your prompts still travel to someone else's servers.

The same plumbing could cover other metered services, per the post: blockchain data queries, image and video generation, VPNs, and payments between machines. Providers would have to accept a proof instead of an API key and settle signed usage receipts to integrate directly.

The repository itself labels the protocol experimental and does not list a formal audit.

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7 hours ago

According to relevant information, Hyperliquid is expected to receive its first AQAv2 reserve revenue allocation tomorrow (October 3). Approximately $14.5 million in passive income generated from the USDC reserve will flow into the Assistance Fund to be used for HYPE repurchases.

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Circle argued that the bank deposit requirement imposed on large stablecoin issuers increases risks. The European Union is reassessing the MiCA rules.

USDC issuer Circle has requested changes to the bank deposit requirements applied to stablecoin reserves under the European Union’s MiCA regulation. In its submission to the European Commission’s MiCA review, the company proposed a more flexible system based on asset liquidity instead of a fixed-rate deposit requirement.

Current regulations require e-money token issuers to hold at least 30% of their reserves in commercial bank deposits. For major stablecoins classified as “material” by the European Banking Authority, this figure can rise to 60%.

According to Circle, this regulation exposes stablecoin reserves to greater credit and counterparty risks in the banking sector. The company cites the 2023 Silicon Valley Bank collapse, where approximately $3.3 billion in USDC reserves remained with the bank, causing the token to briefly lose its $1 peg, as an example of these risks.

Circle is advocating for the consideration of a liquidity requirement that allows a certain portion of reserves to be cashed out within one to five business days, rather than a strict minimum deposit requirement for bank deposits. The European Central Bank and some national central banks also support a similar approach.

The company also objected to the rule limiting reserve exposure to a single country’s government bonds to 35 percent. Circle argues that this limit makes it difficult for a dollar-based stablecoin to hold a significant portion of its reserves in US Treasury bonds.

As part of the same review, the Hyperliquid Policy Center also requested that perpetual futures contracts on the chain be evaluated under the existing MiFID II derivatives rules instead of MiCA.

These are requests submitted by industry organizations. This does not mean that the European Commission has accepted the proposals or amended the MiCA rules. A formal assessment and potential legislative process will need to be completed before a final decision is made.

*This is not investment advice.

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TLDR: Lloyds used USDC bought through Archax to settle $750,000 in obligations with Visa over seven days. Funds reached Visa in under an hour, including over the weekend, versus a day or more traditionally.  Lloyds used its own Canton node while Visa supported settlement on a separate public blockchain.  The pilot was booked through Lloyds’ Corporate Markets branch in Jersey and sent to Visa in the US.  Lloyds stablecoin settlement testing with Visa has reached a first milestone. Lloyds Banking Group completed a seven-day live pilot using USDC to settle $750,000 in payment obligations.

The bank bought the stablecoin through Archax, a UK-regulated digital asset exchange. Funds reached Visa in under an hour, including over the weekend.

Lloyds is among the largest retail banking groups in the United Kingdom. The trial focused on settlement rather than the way payments are made.

How the Lloyds and Visa Pilot Worked The Lloyds stablecoin settlement pilot marks the first such trial between Visa and a major UK banking group. The pilot ran for seven days and covered a series of US dollar settlement obligations.

Each transaction was a real-world payment obligation between the two firms. Lloyds booked the settlement volume through its Corporate Markets branch in Jersey. The funds were then transferred to Visa in the United States.

According to the announcement, the pilot tested stablecoins alongside existing settlement processes. The trial examined how institutions could move money across borders with greater speed and visibility.

Lloyds and Visa assessed the effect on speed, transparency, and operations. Settlement is the behind-the-scenes process where institutions exchange funds to reconcile payment activity.

Under traditional cross-border processes, settlement can take a day or more. This usually happens when a transaction starts outside banking hours. By contrast, funds reached Visa in under an hour, even on the weekend.

Peter Left, Head of Digital Assets at Lloyds Banking Group, said the test moved the work beyond theory. He added that live obligations allowed the teams to test these capabilities in a real-world setting.

Cross-Chain Setup and Round-the-Clock Settlement The pilot also tested settlement across private and public blockchain environments. Lloyds used its own node on Canton, which offers configurable privacy capabilities.

Visa supported settlement on a separate public blockchain. As a result, Lloyds stablecoin settlement ran across two different network types.

The setup demonstrated interoperability between the two networks. Lloyds and Visa said this matters as liquidity and activity span multiple chains. Interoperability lets institutions reach different networks while keeping flexibility and choice.

Additionally, round-the-clock settlement may help with liquidity management. Less liquidity may stay tied up while settlement completes, especially over weekends and holidays.

Stablecoins could also give institutions better visibility over the status of funds. They could offer greater certainty over when money has arrived. Moving money between markets, currencies, and infrastructures adds time and complexity to cross-border payments.

Rob Cameron, Group Country Manager for UK and Ireland at Visa, said stablecoins can work alongside existing banking infrastructure.

He added that Visa aims to make these forms of money practical, interoperable, and trusted at scale. The Lloyds stablecoin settlement pilot forms part of the bank’s wider work on digital assets and tokenised money.

South Africa’s Absa Group has become Africa’s first bank to offer digital-asset custody. The service gives institutional clients regulated access to storage and transfers for Bitcoin, Ether, USDC and XRPL assets.

Absa Launches Crypto Custody for Institutional Clients Absa has rolled out its Digital Asset Custody platform in South Africa after receiving regulatory approval. The Johannesburg-based bank initially targets asset managers, non-bank financial institutions and corporate clients. Retail customers are not part of the initial rollout.

The platform allows institutions to hold, manage and transfer digital assets through Absa’s banking infrastructure. Bitcoin currently accounts for the largest share of assets in custody. Absa also supports Ether, USDC and assets on the XRP Ledger.

Absa built the custody platform with Ripple technology to manage digital assets. Its Corporate and Investment Banking division operates the service after the companies previously announced their custody partnership.

Absa Eyes Wider Crypto Custody Expansion Absa plans to support more crypto assets as institutional demand develops. However, the bank has not given a timeline or confirmed which assets it could add next.

“We expect to extend this to other client segments in South Africa in due course,” Rob Downs, head of digital assets at Absa Corporate and Investment Banking, said.

Downs added that Absa is “actively working” to introduce the service in some of its other African markets. Those plans remain subject to regulatory approval in each market.

As earlier reported by CoinGape, major financial institutions have also expanded their digital-asset custody offerings as banks develop infrastructure for institutional crypto holdings.

South Africa Crypto Custody Market Reaches R25.3 Billion Absa enters the sector as crypto assets held by major South African providers continue to grow. Luno, VALR and Ovex held R25.3 billion, or about $1.5 billion, by the end of 2024.

The South African Reserve Bank reported that the figure had more than doubled from below R10 billion in early 2023. The increase covers assets held by the three licensed providers.

Absa will now compete for institutional assets through its regulated banking infrastructure. Its entry gives South African companies and asset managers another custody option as banks expand their crypto custody infrastructure.

Lloyds Banking Group has successfully completed its first live pilot of stablecoin settlements with Visa, using the USDC stablecoin to settle $750,000 in payment obligations over a seven-day period. In this test, funds reached Visa in less than an hour—even during weekends—marking a significant improvement in settlement speed when compared to traditional methods.

Streamlining cross-border settlementsBoth Lloyds and Visa focused the trial on the settlement layer, rather than direct payment flows, to assess how institutions can move money across borders more rapidly and transparently. Traditionally, cross-border settlements require at least a full business day, and delays often stretch further if processing begins outside standard banking hours.

Lloyds, one of the UK’s major retail banking groups, acquired USDC through Archax, a digital asset exchange regulated in the United Kingdom. Each settlement reflected a genuine payment obligation between Lloyds and Visa, with transactions routed through Lloyds’ Corporate Markets branch located in Jersey before being delivered to Visa in the United States.

The pilot was designed to run stablecoin settlements in parallel with existing processes, providing insights into enhancements in speed, accuracy, and liquidity management. According to Lloyds, using digital assets in real transactions enabled both parties to test technological and operational frameworks in real-world conditions.

Peter Left, Head of Digital Assets at Lloyds Banking Group, emphasized that testing with live obligations moved this project beyond the theoretical stage and allowed teams to assess the technology’s capabilities in actual production-like scenarios.

Interoperability and round-the-clock operationsLloyds and Visa also tested settlement interoperability between private and public blockchain environments. Lloyds relied on its own node hosted on the Canton network, which supports configurable privacy features, while Visa supported settlement activity on a separate public blockchain.

This setup demonstrated how stablecoin settlements can be conducted across two distinct network types, offering increased flexibility for institutions operating across multiple blockchains and infrastructures. Interoperability between networks became a central focus, especially as institutional liquidity and operational activity increasingly span different chains.

Mini dictionary: Canton is a privacy-enabled blockchain network specifically developed to facilitate the secure transaction and settlement of digital assets among institutional participants.

The ability to settle transactions at any time, including weekends and holidays, can ease liquidity management by reducing the amount of money held in transit. This offers institutions more predictable access to funds, which is particularly important as they navigate multi-currency and multi-market operations.

Stablecoin-based settlements can also provide greater transparency and certainty around transaction timing. Visa’s Group Country Manager for UK and Ireland, Rob Cameron, also highlighted that stablecoins are increasingly able to support existing banking infrastructure, while building out trust and interoperability at scale for financial institutions.

Visa aims to make new forms of digital money practical, interoperable, and trusted at scale, with stablecoins becoming a core area for institutional adoption.

Lloyds confirmed the stablecoin settlement trial forms part of its broader program to explore the use of digital assets and tokenized money in global payment applications.

AspectTraditional SettlementStablecoin PilotSettlement Speed1 day or moreUnder 1 hourAvailabilityBusiness days/hours24/7 (including weekends)Currency UsedFiat USDUSDC stablecoinNetwork TypeBank networksPrivate and public blockchains

South Africa’s Absa Group has launched digital-asset custody services for institutional clients after receiving regulatory approval. The service supports Bitcoin, XRP Ledger, Ethereum and USDC, with plans to add more assets. Absa will provide safekeeping, administration and transfer services to asset managers, non-bank financial institutions and corporates. The bank plans to expand the service to other client segments and African markets, subject to regulatory approvals. South African crypto assets under custody reached R25.3 billion ($1.5 billion) by the end of 2024, according to the South African Reserve Bank.

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According to Bloomberg, Absa has become the first bank on the African continent to offer digital asset custody services, providing secure custody, management and transfer of digital assets to its South African institutional asset clients—including asset management firms, non-bank financial institutions and corporates. The bank has obtained approval from South African regulators for the custody service, which currently supports Bitcoin, Ethereum, XRP and USDC. Absa plans to expand its service scope to cover more assets.

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PANews, October 2 — According to official sources, the Ethereum Foundation announced that it has jointly developed zkAPI with the Open Anonymity Project, and it is already running on the Ethereum mainnet. zkAPI uses zero-knowledge proofs to separate payments from identity: users only need to deposit assets such as ETH and USDC into a vault contract on Ethereum once, after which they can authorize AI API usage quotas without revealing their identity. Service providers can see the content of requests but cannot learn the payer's identity, while payment service providers can only see the amount spent and cannot link it to specific requests or users.

zkAPI works as follows: the user's device generates a proof verifying that certain funds are sufficient to cover the current consumption and have not been used before; after the server verifies it, it generates a temporary API key with a quota cap and validity period. The user can then directly use this key to send requests to the AI service provider, which records actual usage and generates a signed credential, and the system ultimately deducts fees from the user's private balance according to actual usage. The Ethereum network only records on-chain operations such as deposits, settlements, and withdrawals, and cannot learn which services specific funds were used to pay for. The solution employs cryptographic techniques such as Groth16, BN254, Poseidon, and Merkle trees, and allows users to withdraw funds directly from the chain if the server stops running.

The Ethereum Foundation stated that zkAPI is initially aimed at AI inference scenarios, because prompts users submit to AI models may involve sensitive information such as health and finances, but the mechanism can also be used for usage-based billing scenarios such as blockchain RPC, image and video generation.

Circle has called on EU policymakers to adjust certain provisions in MiCA, noting that the majority of the largest global stablecoins are not included. According to Patrick Hansen, EU strategy and policy director at Circle, only three of the world’s top 30 stablecoins are MiCA-compliant.

Circle Pushes for Wider Stablecoin Recognition According to Circle, MiCA has already established a significant regulated stablecoin ecosystem, featuring approximately 30 e-money tokens approved in Europe. However, the company believes the framework still captures only a small share of the largest global stablecoins.

Hansen said “only 3 of the top 30 are MiCA-compliant today,” referring to USDC, USDG, and EURC. Circle’s accompanying policy post used a top-25 comparison, but it identified the same three regulated stablecoins.

Circle has thus requested the EU to maintain multi-issuance, which would enable a MiCA-licensed entity to issue a token alongside an affiliate in a different jurisdiction. The company stated that limiting that model could shift the European stablecoin market to the offshore market.

Circle Calls for Changes to MiCA Reserve Rules Circle also sought regulators to review MiCA requirements for e-money token issuers regarding reserves. The rules require at least 30% of reserves in commercial bank deposits, rising to 60% for significant issuers.

The company has agreed with the European Central Bank that those thresholds are too strict and may lead to higher risk of banking counterparty exposure. Circle, on the other hand, suggested a liquidity-based rule that takes into account the quality and availability of reserve assets.

This comes on the heels of Circle’s euro-backed stablecoin, which is expanding under MiCA. As we reported, use of EURC grew in payments and settlement, and supply has more than doubled year over year to approximately €400 million. Recently, Revolut has also introduced EURR as a further euro stablecoin in Europe’s regulated market.

Hyperliquid Also Seeks Changes During MiCA Review Circle’s submission coincided with other cryptocurrency firms reacting to the European Commission’s MiCA consultation. The Hyperliquid Policy Committee concentrated its submission on the treatment of perpetual futures.

The committee recommended that perpetual futures continue to be subject to MiFID II as they are derivatives regardless of how trades are recorded. It also opposed applying bilateral CFD restrictions to transparent central limit order books.

Hyperliquid also urged regulators to acknowledge public blockchain data on its reporting obligations when data is already accessible on the chain. Circle, on the other hand, suggested an alternative approach that would extend over a longer period of time and empower recognized foreign stablecoin issuers to function through locally licensed European institutions.

Circle minted about 13.50 billion USDC on Solana in September. That is the largest monthly stablecoin mint the network has ever recorded.

A month of very large deposits The September total did not come from one giant event. Circle issued USDC in repeated batches throughout the month, frequently in tranches of $250 million.

On some occasions the pace climbed to $500 million within short intervals.

The busiest stretch came early in the month. Circle minted $3 billion of USDC within a single 24-hour window, according to the research compiled for this story.

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For comparison, gross USDC minting on Solana in August came to approximately $11 billion. At the time, that was the highest monthly figure on record for the chain.

Minted is not the same as circulating The headline number deserves a footnote. Gross minting measures how much USDC Circle created, not how much new USDC is actually floating around in wallets and apps.

Many large mints first land in treasury or issuer-controlled wallets before being distributed. As a result, net growth in circulating supply tends to be milder than the gross figures suggest.

By late August, USDC supply on Solana had passed $8 billion, which represented more than 10% of all USDC globally.

Every USDC is backed 1:1 by US dollar reserves, so large mints reflect real dollars moving into Circle’s system to be represented on-chain.

Solana’s stablecoin moment By September 25, Solana’s total stablecoin supply reached an all-time high of around $17.3 billion.

That figure is driven mainly by USDC and Tether, the two largest dollar-pegged tokens.

Circle has also been busy off-chain. In September, it struck a deal with Binance that included a $100 million equity stake and a multi-year agreement to promote USDC.

What this means The gross-versus-net distinction is the key thing to watch. Record mints make for eye-catching numbers, but circulating supply is the better gauge of how much USDC is actually being used on the network.

If net supply keeps climbing alongside gross issuance, it would point to dollars settling into Solana’s ecosystem rather than passing through. If the gap stays wide, the story is more about Solana as a high-speed transit route for institutional dollar flows.

The next data points worth tracking are October’s gross mint total, Solana’s circulating USDC supply, and whether the network’s total stablecoin supply holds above the roughly $17.3 billion peak set in late September.

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Lloyds Banking Group and Visa have completed a seven day live stablecoin pilot that settled $750,000 in cross border payment obligations, with funds reaching Visa in under an hour even during the weekend.

Summary

Lloyds and Visa settled $750,000 in live cross border payment obligations using USDC during a seven day pilot. Funds reached Visa in under an hour, including during the weekend, compared with traditional settlement that can take a day or longer outside banking hours. Lloyds bought USDC through UK regulated exchange Archax and used its own Canton node, while Visa supported settlement on a separate public blockchain. The pilot tested whether stablecoins could support round the clock settlement while improving visibility over when funds arrive. According to Lloyds Banking Group, the trial used USDC for a series of real world U.S. dollar settlements between its Corporate Markets branch in Jersey and Visa in the United States.

Lloyds purchased the USDC through Archax, a UK regulated digital asset exchange, before transferring the settlement funds to Visa. The companies focused on the settlement process between financial institutions instead of changing how customers make payments.

Transactions continued outside normal banking hours, including over the weekend. Lloyds said traditional cross border settlement can take a day or longer when transactions begin outside banking hours, while funds moved during the pilot reached Visa in less than an hour.

Lloyds and Visa test stablecoin settlement across blockchain networks The trial tested more than the time required to move the funds. Lloyds operated its own node on Canton Network, using the blockchain’s configurable privacy features, while Visa supported settlement on a separate public blockchain.

Running the transactions across different blockchain environments allowed the companies to test whether stablecoin settlement could work without requiring participating institutions to operate entirely on the same network.

Visa has been working on similar infrastructure before its latest test with Lloyds. In June, crypto.news previously reported that the payments company had tested private stablecoin settlement with Brale using the SBC dollar backed stablecoin on Canton Network.

The earlier proof of concept examined whether financial institutions could settle transactions onchain while restricting access to sensitive transaction information. Visa had previously supported USDC settlement on public blockchains, while the Brale test brought its stablecoin work into Canton’s privacy focused institutional infrastructure.

Lloyds has been testing a different form of digital money on the same network. The bank recently participated in live tokenized deposit transactions alongside Barclays and NatWest as UK banks tested blockchain based payments using commercial bank money.

Its earlier work included issuing tokenized sterling deposits on Canton and using them to buy a tokenized UK government bond from Archax. Lloyds later completed three live transactions under the Bank for International Settlements led Project Agorá involving sterling, euros and Swiss francs.

The Visa pilot took another route by using USDC instead of a token representing a commercial bank deposit.

Stablecoin pilot targets round the clock settlement Settlement timing was one of the main areas tested during the seven day trial.

Banks and companies moving funds internationally can face delays when transactions fall outside the operating hours of the institutions and payment systems involved. Lloyds and Visa tested whether stablecoins could give financial institutions another way to complete certain settlement obligations around the clock.

For treasury operations, Lloyds said the structure could provide more certainty over when funds arrive and improve visibility into their status. Faster settlement could leave less liquidity waiting for transactions to complete during weekends and holidays, according to the bank.

Peter Left, head of digital assets at Lloyds Banking Group, said moving money across different markets, currencies and financial systems can add time and complexity to cross border transactions.

“Settling $750,000 of live payment obligations between Lloyds and Visa using stablecoins has allowed us to move beyond theory and test these capabilities in a real-world setting,” Left said.

He said digital money could make international payments faster, more transparent and more flexible for businesses, while giving companies more certainty over the movement of their funds.

Visa has continued building stablecoin settlement infrastructure as financial institutions experiment with using blockchain networks behind existing payment products.

Its stablecoin card network had reached more than 160 programs by September. Some participants have used USDC to meet Visa settlement obligations seven days a week, including weekends and holidays.

Visa has pursued institutional partnerships outside the UK as well. In August, South Korea’s Shinhan Financial Group signed an agreement with Visa covering stablecoin issuance, transfers and redemption, with the companies planning tests involving stablecoins in card payment settlement.

Rob Cameron, Visa’s group country manager for the UK and Ireland, said existing money movement infrastructure has not always provided the same operating flexibility required by businesses working across borders and around the clock.

“This pilot with Lloyds shows how stablecoins can work alongside existing banking infrastructure to give financial institutions more choice over how and when they settle funds,” Cameron said.

Canton becomes part of Lloyds’ digital money tests Canton Network has become a recurring part of Lloyds’ experiments with blockchain based financial infrastructure.

The bank’s work with tokenized sterling earlier this year involved a different structure from the latest USDC transactions. Tokenized deposits represent a commercial bank deposit onchain, while USDC is issued by Circle and backed by reserves held outside the banking deposit represented by the token.

Other financial institutions have been testing both models as potential settlement assets.

JPMorgan, Citigroup, Bank of America and Wells Fargo have been working through The Clearing House on a shared settlement network designed to let corporate clients move tokenized deposits around the clock, with the project targeting the first half of 2027. Visa, meanwhile, has continued testing stablecoins across public and institution focused blockchain infrastructure.

Canton has attracted stablecoin projects alongside those bank deposit experiments. World Liberty Financial launched its USD1 stablecoin natively on the network in August, allowing the dollar backed token to be used for activities including collateral, lending, issuance, redemptions and cross border settlement.

Financial institutions in other markets are testing similar arrangements. SBI Digital Practice and South Korea’s Nodeinfra agreed in August to develop a cross border settlement network connecting Japan and South Korea through Canton, initially using yen and won test tokens before any planned use of regulated stablecoins.

Lloyds’ latest test kept the existing banking and Visa infrastructure in place while introducing USDC into the settlement process.

The $750,000 in obligations was booked through Lloyds’ Corporate Markets branch in Jersey, converted into USDC obtained through Archax and transferred to Visa in the United States.

Left said the trial gave Lloyds a live environment for examining digital money instead of limiting the work to theoretical models.

Lloyds said the initiative forms part of its ongoing work examining how digital assets and tokenized forms of money can be used to move value between businesses and financial institutions.

Source: Binance EN

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The seven-day trial used USDC purchased through Archax, with funds reaching Visa in under an hour, including over the weekend.

Lloyds and Visa completed a seven-day live pilot using stablecoins to settle $750,000 of payment obligations, in what Lloyds described as the first stablecoin settlement trial between Visa and a major UK banking group.

Lloyds purchased USDC through UK-regulated digital asset exchange Archax for the series of U.S. dollar settlements. The volume was booked through Lloyds' Corporate Markets branch in Jersey and transferred to Visa in the U.S. Funds reached Visa in under an hour, including during the weekend, the bank said Wednesday.

The pilot dealt with settlement between the financial institutions rather than the payments made by customers. Lloyds said traditional cross-border settlement can take a day or more when initiated outside banking hours. "Settling $750,000 of live payment obligations between Lloyds and Visa using stablecoins has allowed us to move beyond theory and test these capabilities in a real-world setting," Lloyds Head of Digital Assets Peter Left said.

Testing settlement across blockchains Lloyds also ran its own node on the Canton Network during the trial, while Visa supported settlement on a separate, unnamed, public blockchain.

Visa's stablecoin settlement volume surpassed a $20 billion annualized run rate last month. In April, Visa added Canton and four other blockchains to its settlement pilot, taking the total to nine.

Lloyds was among six major UK banks that began a live pilot of tokenized sterling deposits last year.

A consortium backed by more than 100 companies, including Visa Inc. (NYSE:V), Stripe and Mastercard Inc. (NYSE:MA), launched a new U.S. dollar-pegged stablecoin Wednesday, stepping up competition in a market dominated by Tether (CRYPTO: USDT) and USDC (CRYPTO: USDC).

OUSD, issued by Open Standard, is now available to businesses and software developers, with Visa, Stripe, Mastercard-owned BVNK and Coinbase Global Inc. (NASDAQ:COIN) providing initial access.

What Gives OUSD An EdgeThe consortium along with Shopify Inc. (NASDAQ:SHOP) have committed to minting roughly $1 billion worth of OUSD to seed liquidity, Bloomberg reported.

Open Standard CEO Zach Abrams, who previously headed stablecoin infrastructure company, Bridge before its acquisition by Stripe in 2025, said the project was designed to address limitations holding back broader stablecoin adoption.

OUSD is already live across four blockchains, including Ethereum (CRYPTO: ETH) and Solana (CRYPTO: SOL), with consortium members planning to integrate the stablecoin into their products.

The combination of payments networks, crypto infrastructure and commerce platforms could give OUSD a built-in distribution network as it attempts to gain traction.

Can OUSD Challenge USDT, USDC Dominance?Despite growing institutional interest, breaking the dominance of Tether and USDC remains a significant challenge for new stablecoins.

USDT has roughly $184 billion in circulation, while even stablecoins introduced by established payments companies such as PayPal Holdings Inc. (NASDAQ:PYPL) remain considerably smaller.

Open Standard’s advantage could lie in its consortium model and distribution.

The project’s initial announcement in June drew investor attention and weighed on Circle Internet Group Inc. (NYSE:CRCL) shares amid concerns that stronger payments-industry competition could challenge USDC’s position.

Image: Shutterstock

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AI agents can now hire humans. The gig is to walk around the physical world and capture it in 3D, with payment in USDC settled on Circle’s Arc blockchain.

The use case is narrow but not trivial. Physical AI and robotics systems need accurate, current spatial data, and the most reliable way to get it is still to send a person with a camera.

How the agent-to-human pipeline works Arc is Circle’s Layer-1 blockchain. That means it is a base network with its own rules for processing transactions, not an add-on built on top of another chain. It officially launched on September 16, 2026.

Its defining design choice is that USDC does double duty. The dollar-pegged stablecoin serves as both the gas token, which pays transaction fees, and the settlement currency.

Most blockchains charge fees in a volatile native token. That makes budgeting awkward for an automated system paying out small amounts. On Arc, a dollar in fees stays a dollar, so an agent can price a job without betting on crypto markets.

One of the platforms built on this setup is VANGRID. It matches AI agents with human participants who produce 3D models of real-world locations.

The workflow looks like this:

An agent posts a request for a scan of a specific place. A human contractor captures the location. The finished model is delivered as a GLB file, a common format for 3D assets. Each scan carries cryptographic provenance and a timestamp, and it is tied to filtered location data. Payment runs through escrow. The agent’s USDC is held until the scan is accepted, and refunds are available if delivery fails.

Arc also supports agent-driven micropayments with sub-second transaction finality.

A small but growing marketplace category VANGRID is not the only example. RentAHuman is another marketplace emerging alongside Arc. It uses the network’s escrow features to handle a range of real-world tasks that agents send to people.

What this means for USDC, Circle, and physical AI For Circle, Arc is a bet that stablecoins can be infrastructure, not just a trading instrument. Using USDC as the gas token ties network activity directly to demand for the stablecoin itself.

There are open questions worth watching.

Quality control. Escrow releases funds when a scan is accepted. The key issue is who, or what, decides acceptance, and how disputes get resolved when an agent and a human disagree about whether a model is good enough.

Labor dynamics. A marketplace where software sets the terms and humans compete for tasks raises familiar gig-economy concerns about pay rates and bargaining power.

Privacy and location data. Scans tied to real places carry obvious sensitivities. The use of filtered location data suggests the platforms are aware of this.

Network concentration. Arc is Circle’s chain and USDC is Circle’s stablecoin. Builders gain a tightly integrated stack, but they also take on dependency on a single issuer for both fees and settlement.

Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.

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Three kits, one stablecoin-native stack@arc, Circle's layer-1 blockchain, has shipped three new developer kits designed to give apps a ready-made toolkit for buying, earning on, and borrowing against $USDC, without requiring builders to assemble the underlying infrastructure themselves.

The three new additions extend that approach into funding, earning, and borrowing.

The Onramp Kit lets users purchase $USDC directly inside an app. The feature is initially available to eligible users in the US, UK, and EU.

The Earn Kit adds $USDC and $EURC lending through @Morpho.

Bitcoin collateral, no sale requiredThe third kit, Borrow Kit, may be the most notable for bitcoin holders. Arc has integrated @Morpho as its main lending infrastructure, allowing institutions to borrow stablecoins like $USDC and $EURC using cirBTC, a Bitcoin-backed token, as collateral.

Morpho is the first lending protocol supported by Circle for this product, with Aave planned to be added later. The service is currently available on Arc and Ethereum, but is not available to customers in New York.

The kits arrive roughly two weeks after Arc's public mainnet went live. Circle launched Arc as a layer-1 blockchain for institutional finance, with BlackRock, Mastercard, and Visa among its founding validators. $USDC has more than USD 74 billion in circulation. On launch day, deposits into Morpho markets on Arc exceeded $150 million, pointing to strong early demand.

Sources:
Arc: Onramp Kit, Earn Kit, and Borrow Kit Are Now Live on Arc
Circle: Arc Mainnet launch press release
The Paypers: Circle launches Arc mainnet for institutional finance

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