Transfer USDC with Data Using Chainlink CCIP

USDC (USD Coin) is a fully-backed digital dollar redeemable 1:1 for US dollars, issued by Circle across multiple blockchain platforms. This guide explores how Chainlink's Cross-Chain Interoperability Protocol (CCIP) facilitates USDC transfers between blockchains, whether they support Circle's Cross-Chain Transfer Protocol (CCTP) or use Bridged USDC alternatives.

Key Concepts

Native USDC vs. Bridged USDC

New blockchains often face the cold start problem—limited initial liquidity and adoption hindering dApp functionality. Circle's Bridged USDC Standard addresses this by:

• Reducing Fragmentation: Unified USDC supply across chains.
• Enhancing UX: Simplified management of bridged tokens.
• Enabling Upgrades: Smooth transition to Native USDC via CCTP once approved.

Migration Path: Projects using Bridged USDC can shift to Native USDC without disrupting user balances or contracts when their chain supports CCTP.

How CCIP Handles USDC Transfers

CCIP provides a consistent API for both Native and Bridged USDC transfers:

1. Components: Uses the same onchain (Router, OnRamp, OffRamp) and offchain (Executing DON, Risk Management Network) infrastructure.
2. Security: Enhanced by CCIP’s Risk Management Network.

Native USDC (CCTP-enabled)

1. Source Chain: USDC Token Pool burns tokens via CCTP.
2. Offchain: Circle’s attestation service authorizes minting on the destination chain.
3. Destination Chain: CCTP mints USDC upon receiving attestation.

Bridged USDC (Non-CCTP-enabled)

1. Lock and Mint: Native USDC is locked on the source chain; Bridged USDC is minted on the destination.
2. Isolation: Non-CCTP transfers are blockchain-specific for security.

Tutorial: Transfer USDC from Avalanche Fuji to Ethereum Sepolia

Prerequisites

• Accounts: Funded with AVAX/LINK (Fuji) and ETH (Sepolia).
• Tokens: Acquire testnet USDC via Circle Faucet.
• CCIP Support: Verify USDC support in the CCIP Directory.

Step-by-Step Guide

1. Deploy Contracts

• Sender (Avalanche Fuji):

  • Router: 0xf694e193200268f9a4868e4aa017a0118c9a8177
  • LINK: 0x0b9d5D9136855f6FEc3c0993feE6E9CE8a297846
  • USDC: 0x5425890298aed601595a70AB815c96711a31Bc65

• Receiver/Staker (Ethereum Sepolia):

  • Router: 0x0BF3dE8c5D3e8A2B34D2BEeB17ABfCeBaf363A59
  • USDC: 0x1c7D4B196Cb0C7B01d743Fbc6116a902379C7238

2. Configure Cross-Chain Settings

• Set sender/receiver addresses and gas limits (e.g., 200,000 gas for Sepolia).

3. Transfer USDC

1. Initiate Transfer: Call sendMessagePayLINK on Fuji with:

   • Destination Chain Selector: 16015286601757825753 (Sepolia).
   • Beneficiary: Target EOA.
   • Amount: 1000000 (1 USDC, 6 decimals).
2. Monitor: Track via CCIP Explorer.
3. Redeem: Beneficiary calls redeem on Sepolia’s Staker contract.

FAQ

What if my blockchain doesn’t support CCTP?

Use Bridged USDC with CCIP’s Lock/Mint mechanism. Migrate to Native USDC once CCTP is enabled.

How are fees calculated?

Fees depend on gas costs and data size. This example uses LINK for fee payment.

Can I transfer other tokens with CCIP?

Yes! CCIP supports any ERC-20 token listed in its directory.

Smart Contract Deep Dive

Sender Contract

• Function: sendMessagePayLINK packages USDC, data (stake function call), and pays fees in LINK.
• Security: Validates receiver/gas limits to prevent failed transfers.

Staker Contract

• Stake/Redeem: Mints/burns staking tokens 1:1 with USDC.

Receiver Contract

• Error Handling: Stores failed messages for retries via retryFailedMessage.

👉 Explore CCIP Mainnet Deployments
👉 Read the Full API Docs

Need more? Check Circle’s Bridged USDC Standard for migration best practices.