Blockchains are public databases. That’s an immediate roadblock for large institutions like banks, whose clients largely don’t want their balances and payments history open to prying eyes. Now, the crypto giant Circle has partnered with the blockchain Aleo to launch a “private” version of its stablecoin called USDCx, which will obscure transaction histories, Howard Wu, cofounder of Aleo, told Fortune.
“People don’t want to reveal their business revenues. They don’t want to reveal business intelligence,” Wu said. “But the way that transparent blockchains work today unfortunately means that every time you transact, you are leaking that data.”
The new Circle-backed token, which like other stablecoins is pegged to underlying assets like the U.S. dollar, won’t be truly private. Every transaction of the token will include what Wu called a “compliance record,” which Circle will be able to access in case law enforcement or other authorities reach out about specific transactions. Still, for public users looking at a blockchain log, the transactions will look unintelligible and like “blobs of data,” Wu said.
“This is banking-level privacy, as opposed to ‘privacy privacy,’” he added.
Big banks lean in
The launch of USDCx comes amid a broader push from the crypto industry to persuade big banks and institutions to use blockchain technology. That effort appears to be gaining traction, especially in the realm of tokenization, or the act of putting real-world assets like mortgages or even the U.S. dollar in blockchain wrappers.
The asset management giant BlackRock has launched its own tokenized money market fund BUIDL, the online brokerage Robinhood has dabbled in blockchain-based stock trading, and fintech giants like Stripe have invested huge sums of capital into stablecoins. “Every stock, every bond, every fund—every asset—can be tokenized,” Larry Fink, cofounder and CEO of BlackRock, said in his 2025 letter to investors.
Wu, the cofounder of Aleo, has seen interest in privacy-enabled stablecoins from a swathe of potential customers, including the crypto payroll processors Request Finance and Toku. He also said that prediction markets, or locales where gamblers can bet on real-world events and sports, are also interested in experimenting with stablecoins like USDCx.
Aleo, which specializes in private blockchain transactions, isn’t the only privacy-first technology of its kind in crypto. There are other cryptocurrencies—most famously Zcash—which also promise users encrypted transactions. However, these cryptocurrencies are much more volatile than stablecoins, which, as their name implies, are designed to stay stable relative to the U.S. dollar or other currencies.
