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Circle has paired up with Aleo to develop a privacy focused version of USDC, aimed at users who want stable payments without exposing sensitive financial details. The plan brings together Circle and the layer 1 blockchain Aleo, according to reporting from Fortune that cites Aleo co founder Howard Wu.
Good to Know
The project centers on USDCx, a new token that intends to give companies and everyday users a shield from public blockchain logs. Wu said transparent ledgers make it far too easy for anyone to track revenue patterns, vendor relationships or competitive data.
He said: “People dont want to reveal their business revenues. They dont want to reveal business intelligence. But the way that transparent blockchains work today unfortunately means that every time you transact, you are leaking that data.”
USDCx will not behave like a fully private asset. Instead, blockchain observers will see scrambled information rather than readable transaction details. Each transfer will also include a compliance record that Circle can access if regulators ask for information.
Wu described the model as “banking level privacy, as opposed to ‘privacy privacy.”
Early interest has already come from firms such as crypto payroll platforms Request Finance and Toku. Wu noted that prediction markets want to try privacy enabled payments as well, especially for transactions tied to sports or real world events.
Privacy coins like Zcash already offer strong encryption but carry higher price volatility. Stablecoins tie their value to underlying assets, giving them an advantage for payroll, vendor payments, treasury functions and transaction heavy business use.
USDCx aims to deliver stable value while adding an extra layer of privacy without cutting out regulators.