Aave is now integrated into Circle Mint's Digital Asset-Backed Borrowing product, allowing eligible customers to use cirBTC as collateral to borrow USDC directly on Arc or Ethereum, according to a post on X by Aave.
Circle Mint, which issues USDC stablecoin, launched the borrowing feature to let customers access liquidity against bitcoin-backed collateral without unwinding their holdings. The integration sets a 78% collateral factor on cirBTC and caps the supply at 1,100 cirBTC, per Aave's Arc configuration parameters.
Circle Mint is Circle's institutional platform for customers to hold, mint, and transact with USDC. The company issued an announcement on October 6 detailing the Digital Asset-Backed Borrowing product, which enables customers to pledge digital assets and draw stablecoins in return. The integration with Aave extends this capability to one of the largest decentralized lending protocols by total value locked.
Aave operates across multiple blockchains and manages over $10 billion in total deposits across its instances. Arc is Aave's official lending pool for institutional clients, built to support higher collateral factors and custom risk parameters than the protocol's retail-facing pools on Ethereum mainnet and other chains.
The cirBTC token, issued by Circle, represents bitcoin held in custody. Borrowers using cirBTC as collateral through Aave gain access to USDC liquidity while maintaining exposure to bitcoin price movements. The 78% collateral factor means a borrower with 1 cirBTC could borrow up to 0.78 USDC worth of value, assuming 1 cirBTC trades at parity with BTC.
Integrations between institutional stablecoin platforms and lending protocols have become routine as custody providers and stablecoin issuers build out capital markets infrastructure. The arrangement allows Circle Mint to offer borrowing services without building its own matching engine, while Aave gains institutional custody-backed collateral on Arc.
The supply cap is set at 1,100 cirBTC, with either party required to approve an increase through their respective governance or operational processes.
