Circle and Stripe Abandon Ethereum: The Inside Scoop on Their Bold Move to Proprietary Blockchains

Finance giants Circle and Stripe just dropped Ethereum like a bad habit—here's why they're betting big on their own chains.

The Great Ethereum Exodus

When two of crypto's biggest institutional players ditch the world's smart-contract pioneer, you know something's up. Gas fees? Network congestion? Or just old-fashioned corporate control? We dug into the shift.

Build-It-Yourself Blockchain Mania

Forget 'decentralization maximalism'—these companies want chains that bend to their rules. Faster settlements, customized compliance, and (of course) a bigger slice of the revenue pie. Wall Street would be proud.

The Cynic's Corner

Let's be real: this isn't about ideology. It's about cutting costs and keeping regulators happy—while pretending it's all for the sake of 'innovation.' The real question? Who follows them next.

TLDR

• Circle and Stripe are building their own blockchains (Arc and Tempo) to control settlement networks for digital payments
• Multiple companies like Plasma, Stable, and Dinari are launching dedicated chains for stablecoins and tokenized assets
• Firms want to reduce costs, embed compliance measures, and avoid dependence on external networks like Ethereum
• Custom chains allow companies to control transaction fees, issue gas tokens, and integrate KYC checks at the protocol level
• Analysts believe Solana may face more competition than Ethereum, which maintains strong institutional support

Circle and Stripe have joined a growing trend of companies building their own blockchains for digital asset payments. Circle announced its Arc settlement network while Stripe revealed Tempo, developed with investment firm Paradigm.

Introducing Arc, the home for stablecoin finance.@Arc is an open Layer-1 blockchain purpose-built to drive the next chapter of financial innovation powered by stablecoins.

Designed to provide an enterprise-grade foundation for payments, FX, and capital markets, Arc delivers… pic.twitter.com/Z8FHUls1xY

— Circle (@circle) August 12, 2025

The move reflects a broader shift in the crypto industry. Startups Plasma and Stable recently raised funding to create dedicated chains for USDT, the world’s largest stablecoin worth $160 billion.

Tokenization companies are following suit. Securitize is building Converge with Ethena, while ONDO Finance announced plans for its own blockchain earlier this year.

Dinari recently said it will launch an Avalanche-powered layer-1 network. The chain will handle clearing and settling tokenized stocks.

Most stablecoins and tokenized assets currently operate on public blockchains like Ethereum, Solana, or Tron. These networks provide global reach and liquidity but come with limitations.

Martin Burgherr from crypto bank Sygnum said building custom chains gives companies control and strategic positioning. Firms can embed compliance features directly into their networks.

Control Over Settlement Infrastructure

Companies want to avoid dependence on external networks for settlement. This reliance exposes them to unpredictable fees and governance decisions beyond their control.

Custom chains let companies issue their own gas tokens. They can control transaction costs and isolate network performance from unrelated activity.

Morgan Krupetsky from Ava Labs explained that blockchains increasingly serve as companies’ middle and back office operations. User-facing apps may operate across multiple chains while Core transactions happen on proprietary networks.

Guillaume Poncin from Alchemy highlighted the revenue potential. He said owning settlement infrastructure could generate more income than traditional payment processing margins.

Custom chains enable companies to implement know-your-customer checks at the protocol level. This integration streamlines compliance processes that currently require separate systems.

Market Impact on Existing Networks

The new chains target high-throughput, low-fee payments. Coinbase analysts believe this could pressure solana more than other networks.

Ethereum faces less immediate threat due to its strong institutional user base. The network has established itself as a trusted platform for high-value transactions.

However, winning users from established networks will take time. Burgherr said new entrants need years to build trust and shift liquidity from incumbent platforms.

Financial institutions value proven security and custody integration. They prefer networks with demonstrated resilience under market stress.

Burgherr called ethereum the institutional “Fort Knox” of blockchain networks. The platform’s established reputation provides a defensive advantage against new competitors.

Most new chains maintain compatibility with Ethereum Virtual Machine standards. This approach makes integration with existing blockchain infrastructure easier and faster.