Circle, the stablecoin issuer, has acquired Interop Labs, the initial developer of the Axelar network.
This transaction does not include the Axelar network, the foundation, or the AXL token. They will continue to operate independently. In the future, network development will be handled by Common Prefix.
Circle, acquisition of Interop Labs team and technology
Circle, the issuer of the second largest stablecoin USDC, announced that it has signed a contract to acquire the team and exclusive technology of Interop Labs.
Circle plans to accelerate the development of the Arc blockchain and cross-chain transfer protocol (CCTP) through this acquisition. They stated that this deal is expected to be finalized in early 2026.
“Our goal is to perfect blockchain connectivity. Joining the Interop Labs team at Circle will accelerate the development schedule of Arc and CCTP, bringing us one step closer to building a hub for multi-chain internet finance.” said Nikhil Chandhok, Chief Product and Technology Officer at Circle.
Both Circle and Interop Labs emphasized that the Axelar network is not included in this acquisition.
“Even if the Interop Labs team moves to Circle, the Axelar network, foundation, and AXL tokens will operate independently under community governance, and the open-source intellectual property will also remain open-source.” Circle added.
Common Prefix, which has contributed to the Axelar network for a long time, will lead network development going forward. In a recent post on X (formerly Twitter), the team revealed their major priorities for 2026.
The key goals for 2026 include expanding Axelar through new protocols and asset classes, reallocating resources from inefficient chains, enhancing economic security through the introduction of joint staking for blue-chip assets, preparing the network for institutional use by improving privacy and regulatory compliance, and creating an environment for fee-less transfers using a gasless bridge with idle gateway capital.
“Common Prefix is a team of scientists and engineers. Our scientists are involved in postdoctoral research, PhDs, and professorships at world-renowned universities. We are a team focused on multi-chain and have deep expertise in various areas such as Ethereum, XRP Ledger, Sui, Solana, Cosmos, and Bitcoin (jointly invented by BitVM). We believe in a multi-chain world where different chains are used for different purposes. The interoperability layer of Axelar is a key element that allows them to communicate with each other.” said the team.
Market response… Community concerns
The market reacted quickly to the news of this acquisition. The price of AXL tokens dropped significantly, continuing its downward trend. At the time of writing, the altcoin is trading at $0.11, recording a decline of about 13% over the day.
However, this downward trend is not unique to AXL tokens. The entire cryptocurrency market has also dropped by about 4% compared to the day before, and major assets like Bitcoin and Ethereum are also showing weakness.
Such moves have raised concerns among some community members. Cryptocurrency critic Nick assessed this deal as “very concerning” for AXL holders.
“As an AXL holder and supporter, I can’t shake the feeling of being very exploited in this situation. It’s like using AXL as the ‘butter and bread’ for building the platform for retail and VC, only to hand over the entire platform value to Circle overnight.” he stated.
Meanwhile, another analyst pointed out that this incident reflects the ‘token vs. stock issue’ in the cryptocurrency industry.
“You funded the project. You took on the risk. However, there is no right to an exit. Tokens are not shares and are not originally shares. ‘Maintaining community governance and independence’ ultimately means that the creators leave to find better conditions.” said Steady Crypto.
The commentator also mentioned that while Common Prefix has joined as a new lead developer, no team has any obligation to remain indefinitely.
“Before cryptocurrencies solve this issue, investing in all tokens is based on the assumption that the team remains, and there is no contractual obligation for them to stay.” said an analyst.
This announcement has clearly shaken the trust of AXL holders. The future of the project now depends on whether Common Prefix can successfully execute the roadmap and restore the long-term value of Axelar.
