Circle Introduces Upgrade to Reduce Transaction Fees
Circle, a stablecoin issuer, has announced an upgrade aimed at reducing transaction fees by approximately 7%. The v2.2 upgrade is focused on USDC and its euro counterpart EURC, and it significantly improves transaction efficiency on Ethereum Virtual Machine (EVM) blockchains.
New Features for USDC and EURC
The upgrade brings six key changes, including the adoption of EIP-1271 for signature validation from smart contract wallets. This enhancement allows transfers from smart contract wallets in addition to private key wallets, improving support for account abstraction. Circle CEO Jeremy Allaire emphasized that this upgrade will reduce gas costs for every transaction and improve security on EVM chains.
Additionally, the upgrade optimizes the blocklist check process in USDC and EURC smart contracts, resulting in a more efficient lookup process and reduced network gas fees.
Enhanced Stablecoin Security
In addition to reducing gas fees, the upgrade also introduces measures to improve resilience against forks of EVM blockchains. It allows for dynamic inference of the official chainID, protecting users from potential misuse of funds on unofficial forks. The upgrade also removes blocklist checks from functions that do not move funds, further reducing network gas fees when using USDC and EURC.
The v2.2 upgrade is fully backward-compatible and does not require any action from developers or users. The rollout begins on the Avalanche Fuji testnet, with plans to complete the upgrade across various blockchains over the next few months. The Ethereum mainnet and other platforms will see the implementation of this upgrade in January 2024.
Hot Take: Circle’s Upgrade Aims to Make Stablecoin Transactions More Cost-Efficient
The v2.2 upgrade introduced by Circle demonstrates a commitment to making stablecoin transactions more cost-efficient and secure. By reducing transaction fees and enhancing support for account abstraction, Circle aims to improve the user experience within the EVM ecosystem. The phased rollout of this upgrade across various blockchains indicates Circle’s dedication to ensuring widespread accessibility and efficiency for stablecoin transactions.
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