Circle has signed an agreement to acquire Interop Labs to boost interoperability, in a move to deepen its multichain infrastructure. The deal folds Axelar’s original developers into Circle as it advances Arc and CCTP for regulated, cross-chain digital finance.

Circle To Bring Interop Labs In-House

Circle has announced its acquisition of the core development team and proprietary intellectual property of Interop Labs. The company states that its acquisition of Axelar, best known as the initial builder of the Axelar cross-chain network, is aimed at strengthening its interoperability and multichain infrastructure. The acquisition is still an ongoing process and is expected to close in early 2026.

Under the agreement, Interop Labs’ engineers and IP will be integrated into Circle’s product and engineering organization, while the Axelar network itself, alongside its foundation and AXL token, is not part of the transaction.

According to a press release from the Axelar Foundation, the network will continue operating as an open-source, community-governed network, with stewardship of ongoing development shifting to Common Prefix, another long-standing contributor.

Axelar and Interop Labs have focused primarily on cross-chain messaging and token transfers, enabling applications and assets to move securely across multiple blockchains without relying on centralized bridges.

Circle plans to fold this expertise directly into its Arc blockchain initiative and its Cross-Chain Transfer Protocol (CCTP), which allows native USDC and other assets to move between chains without custodians.

Strengthening Arc and CCTP Infrastructure

Circle explained that the acquisition is designed to advance three goals; speeding up interoperability for assets issued on Arc across many blockchains, improving developer tools and software kits for multichain applications, and strengthening Circle’s first-party application development.

Circle Chief Product and Technology Officer Nikhil Chandhok said the company’s objective is to remove friction from blockchain connectivity, adding that bringing the Interop Labs team in-house will fast-track Arc and CCTP as Circle builds a central hub for multichain internet finance.

Arc is positioned by Circle as an enterprise-grade layer one blockchain, internally described as an “economic operating system for the internet” for regulated digital asset issuance and settlement, while CCTP enables secure cross-chain transfers by burning and minting assets like USDC rather than wrapping them. Arc’s public testnet went live in October, with Circle gradually expanding functionality.

While Circle has emphasized the technical motivation behind the acquisition, Interop Labs also brings experience from the stablecoin sector.

In January, Interop Labs joined the Stablecoin Standard initiative to advance global interoperability, where its role centered on reducing liquidity fragmentation and enabling secure cross-chain communication for stablecoin issuers.

Also read: JPMorgan Brings Money Market Fund Onchain via Ethereum

Stablecoin Growth Puts Interoperability in Focus

The stablecoin market itself has expanded from negligible levels in 2014 to over $300 billion by late 2025, driven by faster settlement, lower costs, programmability, and growing regulatory clarity with projections placing the market between $1 billion to over $2 billion. Against this backdrop, Circle sees the acquisition as a way to unlock more of stablecoins’ potential as financial institutions and governments increasingly adopt them.

“We’re incredibly proud of what we’ve built with Axelar and excited to see our team and technology become a core part of Circle’s interoperability strategy”, said Interop Labs CEO Sergey Gorbunov, adding that together the companies aim to lay the “groundwork for the next phase of cross-chain finance”.

As banks, payment firms, and even central banks explore stablecoin use cases, Circle is betting that deeper interoperability will be critical. By bringing Interop Labs in-house, the company is positioning itself to be a leading institution in the next stage of regulated, multichain digital finance.