Circle is defending the economics of USDC after Coinbase, its largest distribution partner, joined a rival stablecoin project designed to pass most reserve income to participating businesses after a management fee.
In a post published Oct. Distribution payments and transaction costs accounted for roughly $819 million, while Circle said it reinvested about $473 million in licenses, banking relationships, settlement liquidity, compliance, product development and blockchain integrations. The company said about 7 cents of every revenue dollar became net profit.
Coinbase reported that average USDC held in its products reached $20 billion in the second quarter, a 44% increase from a year earlier. Circle also said more than 150 other partners have an economic interest in USDC, including exchanges, wallets, neobanks, fintech companies, payment platforms, banks and enterprises.
Businesses are expected to mint and redeem the token without fees or volume limits, while most reserve earnings would be distributed to participating partners after a management fee. The project is to be governed by an independent organization shared among its partner companies rather than by one issuer.
Circle argued that reserve income must also support redemption capacity, regulatory compliance, liquidity and round-the-clock settlement. It said USDC handled more than $36 trillion in on-chain transaction volume during the first half of 2026 and that it minted and redeemed more than $315 billion of USDC during the period. By June, Circle said, USDC represented about 77% of global stablecoin transaction volume, compared with 60% a year earlier.
Circle said standard customer redemptions remain free and generally settle within two business days. Customers using Circle Payments Network or certain Circle platform products can access free near-real-time redemptions, while second-quarter combined minting and redemption volume reached $170 billion, up 105% year over year. The competing model puts pressure on Circle to balance partner compensation against the costs of maintaining the infrastructure behind USDC.