Circle, known as the issuer of the USDC stablecoin, is considering the implementation of a transaction reversal mechanism to enhance user security in cases of fraud or disputes. This could be a significant step towards integrating stablecoins into the broader financial system and providing additional protection for investors and users.
This is reported by Finway
Circle explores the experience of traditional finance
Company President Heit Tarbert emphasized the importance of borrowing practices from the traditional financial sector. In his view, the stablecoin industry should move towards greater transparency and the protection of token holders’ rights, which would foster trust in digital assets.
“We are contemplating whether transaction reversibility is possible, but at the same time, we want to ensure the finality of settlements,” said Tarbert.
According to Tarbert, discussions are currently ongoing among software developers regarding the possibility of implementing transaction reversibility on specific blockchains and under certain conditions—such as if all parties agree to a refund in cases of fraud.
Innovations in the Circle ecosystem: Arc blockchain and financial data protection
Currently, Circle is working on creating a new Arc blockchain, where transactions are non-reversible. At the same time, the idea of implementing an additional layer is being considered, which would allow for counter payments similar to refunds on a bank card, if all transaction participants agree.
Additionally, the company plans to give users the ability to customize the level of transparency regarding balances and transactions to protect personal financial information. Meanwhile, wallet addresses will remain accessible on the blockchain, while the amounts of transfers on the Arc network will be encrypted.
“If you are a financial institution or work with clients and transfer money, you don’t necessarily want everyone to see every transaction, so we created a privacy layer to protect the amount,” added Tarbert.
Previously, Circle had already introduced the Gateway platform to unify USDC liquidity in a multi-chain environment.