Circle, the issuer of the stablecoin $USDC worth $74 billion, is exploring the possibility of implementing reverse transactions to combat fraud and harmonize with traditional finance. Circle's President, Hit Tarbert, noted in a comment to the Financial Times that the company is considering mechanisms for refunding in cases of fraud or disputes while maintaining the finality of settlements inherent in blockchain. This could represent a significant shift, as the irreversibility of transactions is a key feature of cryptocurrencies.
The new blockchain platform Circle, Arc, aimed at institutional users such as banks and corporations, will not support direct reversals but may include a "counter-payment" layer similar to credit card chargebacks. This is intended to make USDC more attractive to large financial institutions wary of irreversible errors or fraud.
Such a move has sparked discussions: proponents of decentralization consider it a departure from blockchain principles, while others see it as a way to integrate cryptocurrencies into traditional finance. Additionally, Circle launched the Refund Protocol in April 2025, which provides decentralized dispute resolution through smart contracts, enhancing transparency and trust.
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