- Polygon zkEVM has adopted the Bridged USDC Standard.
- The Bridged USDC Standard allows for a seamless future upgrade to native USDC.
- Polygon Labs will cease support for the old bridged USDC in favor of the new standard.
The importance of stablecoins in the crypto space can not be overemphasized. For new blockchains, support for these assets typically pegged to the dollar plays a crucial role in growth by providing a familiar gateway for new users while allowing several decentralized finance (DeFi) protocols to offer more predictability in services like lending and yield farming.
In light of this significance, Polygon zkEVM‘s adoption of the recently introduced Bridged USDC Standard to make a future transition to native USDC easier raises questions like what is this new standard, and how exactly does it benefit the budding Ethereum Layer 2 chain?
As always, DailyCoin is here to break things down.
What Is the Bridged USDC Standard?
New blockchains are typically unable to secure native blockchain support at the start due to a lack of volume. The Polygon PoS chain, for example, only managed to secure native USDC support in October 2023. For context, the blockchain mainnet launched in June 2020.
Without native stablecoin support, the alternative for many new blockchains has been bridged solutions offered by third parties. However, these solutions offer less security guarantees and lead to fragmented liquidity. Circle’s answer to this problem is the Bridged USDC Standard.
The standard specifies deploying bridged USDC on Ethereum Virtual Machine (EVM) chains. With this standard, Circle can seamlessly upgrade the bridged solution to native support in the future.
“The standard consists of open-source ERC-20 contract code based on the same audited USDC smart contract that has secured billions of dollars in liquidity,” Circle wrote in a November 2023 announcement.
What Bridged USDC Standard Support Means For Polygon zkEVM
Adopting the Bridged USDC Standard provides several benefits to the Polygon zkEVM network. Most notably, the move future-proofs the blockchain from an early stage, preventing incoming apps from making future updates to support native USDC. It also moves users to a more trusted model with greater security guarantees.
Following the support of the new standard, Polygon Labs announced that Polygon zkEVM would be phasing out the already supported form of bridged USDC in circulation. As such, users and developers must migrate to the new standard.
How You Can Migrate To the Bridged USDC Standard on Polygon zkEVM
Polygon Labs disclosed that this week, users could swap their existing bridged USDC for the new standard at a 1:1 ratio on top decentralized exchanges (DEXes) on Polygon zkEVM.
On the Flipside
- It remains unclear when Polygon zkEVM will receive native USDC support.
- The Bridged USDC Standard is still not supported in Circle products like Circle Mint and Cross-Chain Transfer Protocol (CCTP).
- For new blockchains that kick off with the Bridged USDC Standard, users will not need to carry out any migrations even after a transition to the native stablecoin.
Why This Matters
Users must understand what the Bridged USDC Standard entails and what it means for them and the Polygon zkEVM network.
Read this to learn more about the launch of native USDC support on Polygon:
What Does Circle Bridging to Polygon Mean for USDC Users?
Find out how Celo developers proposed to filter through competing Layer 2 stack bids:
Celo Devs Unveil Framework to Filter Competing L2 Stack Bids