Overview
- Circle launched its Digital Asset-Backed Borrowing flow that mints cirBTC from deposited BTC so eligible institutional customers can borrow USDC without selling their Bitcoin.
- The feature went live on Arc and Ethereum and used Morpho as the first integrated lending market, with Circle activating cirBTC on Sept. 21 as part of the rollout.
- cirBTC is issued 1:1 by Circle International Bermuda Limited, regulated by the Bermuda Monetary Authority, and backed by BTC held in segregated custody with real-time proof-of-reserves from Chainlink.
- Circle does not make the loans or set terms; interest rates, collateral ratios, liquidation thresholds and available liquidity are controlled by third-party protocols such as Morpho and planned integrations like Aave, exposing borrowers to smart-contract and market-driven liquidation risk.
- Early activity shows institutional demand: on-chain snapshots reported roughly 949 cirBTC outstanding against about 951 BTC in reserves and Morpho-reported vaults drew over $150 million in USDC/EURC on day one, while Circle Internet Group shares rose roughly 6%.