Stablecoin issuer Circle has announced its decision to cease support for USDC on the TRON blockchain, citing concerns within its risk management framework.
In a statement released on Wednesday, the company outlined a phased discontinuation plan for USDC support on TRON, scheduled to extend until February 2025. During this transition period, USDC transfer and redemption activities on TRON will continue to operate normally.
“Our decision to discontinue support for USDC on TRON is the result of an enterprise-wide approach involving various functions across our company, including business organization and compliance,” Circle stated.
Circle also announced that it would allow Circle Mint customers to transfer USDC to alternative blockchains until February 2025. Customers will have the option to transfer their USDC from TRON to other compatible blockchains or redeem them directly for fiat currency through Circle.
Circle Mint, a feature offered by Circle, enables businesses and large-scale users to mint and redeem Circle’s stablecoins, including USDC and EURC.
“USDC remains redeemable 1:1 for US dollars, as always,” the company emphasized.
The decision comes amid allegations of TRON’s involvement in money laundering, raising concerns about potential illicit activity within its ecosystem. The Campaign for Accountability, a non-profit ethics organization, wrote a letter to US Senators Elizabeth Warren and Sherrod Brown in November, alleging that Circle facilitated funding for terrorist organizations, citing transfers on TRON as evidence.
Circle denied the allegations, stating that it did not facilitate any illegal financing. However, a Reuters report from December suggested that TRON had become a preferred platform for organizations labeled as terrorist groups to transfer crypto, outshining its competitor Bitcoin.
The move by Circle underscores the challenges faced by TRON and the broader crypto industry in addressing concerns related to illicit financing and regulatory compliance.
