Bitwise: Why Are Top VCs Aggressively Betting on New Public Chains?
- Key Takeaway: Recently, three public chains—Arc, Canton, and Tempo—designed specifically for stablecoins and asset tokenization have secured hundreds of millions of dollars in funding. This reveals three major industry trends: clearer regulatory legislation, privacy protection becoming a commercial necessity, and the official entry of traditional giants into the competitive landscape.
- Key Elements:
- Circle's Arc raised $222 million at a $3 billion valuation, with investors including BlackRock and the parent company of the New York Stock Exchange. Canton Network developer Digital Asset raised $300 million at a $2 billion valuation, led by a16z.
- These financings all occurred after the U.S. Congress passed the
in July 2025, indicating that regulatory clarity has been a key catalyst for institutional capital inflow. - All three public chains natively incorporate private transaction features, differentiating them from chains like Ethereum and Solana, and precisely meeting corporate needs for business privacy, such as not wanting to disclose pending transactions or salary details publicly.
- Arc is spearheaded by publicly-listed company Circle. Canton’s investors include Wall Street giants like Goldman Sachs, Citadel, DTCC, and Nasdaq. Tempo is a joint venture by Stripe and Paradigm, involving companies like Visa and Shopify.
- The entry of traditional giants is expected to bring deeper capital pools and more standardized operations to the industry, likely accelerating innovation through both competition and cooperation with native public chains.
Original Author: Matt Hougan, Chief Investment Officer at Bitwise
Original Translation: Saoirse, Foresight News
Industry news tends to arrive in clusters. When this happens, it's worth paying close attention, as it invariably signals a major trend unfolding beneath the surface.
Just this Monday, Circle, the issuer of USDC, officially announced that its new blockchain project, Arc, had completed a $222 million funding round, reaching a valuation of $3 billion. The investor lineup was stellar, including top-tier institutions like BlackRock, Apollo Funds, and the parent company of the New York Stock Exchange.
The day before, news emerged of a funding round for Digital Asset, the developer behind another emerging blockchain, Canton Network. Led by a16z, the round raised $300 million at a $2 billion valuation.
In a similar vein, Stripe's Tempo blockchain has been leading the race. It completed a $500 million funding round late last year at a substantial $5 billion valuation, subsequently announcing strategic partnerships with companies like DoorDash and Visa.
Arc, Canton, and Tempo — these three public chains are all tailor-made for stablecoin and asset tokenization scenarios. This concentrated wave of fundraising has led me to identify three critical takeaways for the crypto industry.
Capital Always Follows Regulatory Legislation
All of these multi-hundred-million-dollar funding rounds materialized after the U.S. Congress passed the GENIUS Act in July 2025.
I have always believed that before the bill's passage, the sluggish and uncertain pace of U.S. crypto legislation directly dampened industry investment enthusiasm. Major institutions were unwilling to prematurely deploy business operations and build public chain infrastructure amidst regulatory ambiguity. Now that the regulatory landscape is clearer, the industry structure is changing.
No one can say for sure whether these projects could have maintained their current valuations or closed such large funding rounds without the GENIUS Act's support. However, it is certain that regulatory clarity played a key catalytic role.
For investors, the most crucial question to ponder is: What scale of industry opportunity would be unlocked if the comprehensive market structure bill, the Clarity Act, successfully passes through Congress?
The scope of the Clarity Act is far broader than the GENIUS Act, and the final text of the bill hasn't been finalized, making it impossible to precisely predict its full impact right now. But it's clear that the asset tokenization sector and compliant financial infrastructure will be the biggest beneficiaries. I also hope the final version will positively impact areas like decentralized finance and innovative token designs, but we'll have to wait for the official text. The Clarity Act is worth tracking closely for everyone.
Privacy Could Become a Phenomena-Defining Core Application
Arc, Canton, and Tempo share a common feature that also marks their biggest difference from Ethereum and Solana: all three public chains natively incorporate private transaction capabilities.
As crypto assets gradually integrate into mainstream commercial scenarios, this design logic is highly relevant to real-world needs. The transparency of public blockchains is foundational for building trust, but in a business context, it can become a weakness.
Enterprises don't want every pending transaction to be visible to the entire network, and professionals don't want their salary details to be queryable by anyone via a block explorer. In these cases, public transparency is no longer an advantage; it's a practical pain point.
Even the staunchest advocates of blockchain transparency must admit that the commercial world inherently requires a degree of privacy and information confidentiality. By embedding privacy features into their underlying design from the start, these three emerging public chains precisely target the genuine requirements of traditional institutions. The recent rounds of high-value funding confirm that this track is heading in exactly the right direction.
Traditional Giants Officially Enter the Arena, Joining the Competition
The most distinctive aspect of Arc, Canton, and Tempo is the backing they receive from top-tier corporations and financial institutions.
- Arc is being developed under the leadership of Circle, a publicly-listed company;
- Canton's backers include Wall Street giants like Goldman Sachs, Citadel, the Depository Trust & Clearing Corporation (DTCC), Nasdaq, BNY Mellon, S&P Global, and Virtu Financial;
- Tempo is a joint creation of payments giant Stripe and crypto venture capital firm Paradigm, with Anthropic, Deutsche Bank, Revolut, Shopify, Visa, and OpenAI all participating in its architectural design.
This stands in stark contrast to established public chains. Ethereum was proposed by a 19-year-old college dropout on a Bitcoin forum, while Solana was conceived from a flash of inspiration from a Qualcomm engineer.
Of course, this doesn't guarantee that the traditional giants will win. Personally, I have a longer-term preference for crypto-native projects. However, it's undeniable that the entry of banks and large tech companies brings stronger capital, greater execution capabilities, and more professional, standardized operations to the industry.
Competition and cooperation among peers drive growth. I believe that through the two-way competition between giants and native projects, the speed of innovation and the boundaries of development for the entire crypto industry will be further expanded.
After all, iron sharpens iron, and competition and collaboration forge progress.
