Background Review

FXStreet reported on June 12, 2025, that the XRP Ledger will launch a USDC sidechain compatible with the Ethereum Virtual Machine in the second quarter, facilitating cross-chain applications of stablecoins. This move is seen as a complement to the Ethereum mainnet, but it has also caused significant fluctuations in the stock price of USDC issuer Circle.

Technical value and potential impact

• Cross-chain interoperability: EVM sidechains can achieve direct interaction with Ethereum dApps, lowering the threshold for developers.
• Cost advantage: The XRP Ledger charges a transaction fee of less than 0.00001 XRP, which is a clear advantage.
• Ecological diversification: Sidechains will attract the landing of multiple application scenarios such as DeFi, NFT, and gaming.

Interpretation of Circle's Stock Price Fluctuation

1. Competition concerns: The distribution of USDC across multiple chains may erode Ethereum's market share and undermine investor confidence.
2. Profit model risk: lower on-chain fees or compressed revenue sources for Circle.
3. Emotion-driven sell-off: institutions and retail investors take the opportunity to reduce their positions, creating selling pressure.

Currently, the latest closing price of Circle is about 18.50 USD, with a fall of nearly 9.5%; the market price of XRP is around 0.60 USD, fluctuating 1.8% within 24 hours.

Risks and opportunities coexist

• Risks: Market diversion; technology implementation not meeting expectations; changes in the macro regulatory environment.
• Opportunities: Innovation in cross-chain applications; Increased ecological cooperation; Overall expansion of the stablecoin market.

Newbie investment advice

• Buy in batches at dips: For those optimistic about the future of multi-chain, gradually buy near important support levels.
• Set goals: clearly define short-term and long-term return expectations, and strictly implement profit-taking strategies.
• Keep learning: Pay attention to official announcements and community dynamics to grasp the latest developments of the project.