stockrowWhat it does
Circle Internet Group builds financial infrastructure for moving money over blockchain networks. It was founded in 2013, and Jeremy Allaire is its chief executive officer and chairman.
Its best-known product is USDC, a digital token designed to be redeemed one-for-one for U.S. dollars. Circle also issues EURC, which is redeemable for euros. Both are backed by reserves of cash and cash equivalents. Institutional customers can create and redeem the tokens through Circle Mint; other users can obtain or exchange them in secondary markets. Circle also operates USYC, a tokenized money market fund intended primarily as collateral in digital asset markets.
Circle sells services around those assets. Its developer tools help businesses embed digital wallets and automate transactions in their applications. Its interoperability services help users move USDC between supported blockchains. The Circle Payments Network, or CPN, connects banks, payment providers and businesses using stablecoins for money movement, initially focusing on cross-border payments.
Circle also developed Arc, a blockchain network designed for financial activity. Arc Mainnet went live on September 16, 2026, and CPN subsequently launched on it. StableFX, a foreign-exchange protocol on Arc, is designed to let institutions settle trades between supported stablecoins.
The platform serves institutions and developers directly, while consumers can access Circle’s stablecoins through products such as wallets and digital asset exchanges.
How it makes money
Circle earns most of its money from income on the assets backing USDC and EURC. Reserve income depends on the amount of its stablecoins in circulation and the return earned on their reserves. Historically, Circle has earned rates close to the prevailing SOFR, a U.S. benchmark interest rate. Reserve income represented 96.0% of total revenue in 2025; other products contributed 4.0%.
Total revenue and reserve income was $2.7 billion for 2025.
The company also charges for selected services. Circle Mint offers institutional customers free minting and a free basic redemption option; its nearly instant standard redemption carries a fee. xReserve charges blockchain teams a subscription fee to deploy stablecoins that can be redeemed for, and work with, USDC. CCTP, which moves USDC between supported blockchains, generates transaction fees when customers choose its fast-transfer feature. Circle has begun monetizing some CPN payment flows, and StableFX has its own fee model.
Arc provides another potential revenue stream. Q3 2026 revenue included $182 million from an ARC Token presale, recognized when certain performance milestones were met. Circle expects to earn recurring staking rewards after Arc transitions to proof of stake, a system in which token holders help secure the network. It may also sell tokens selectively, while tokens distributed as ecosystem incentives are recognized in other revenue with an offsetting distribution cost.
In Q3 2026, reserve income was $658 million, down 8% year-over-year as a lower reserve return rate more than offset higher average USDC circulation.
| Product or service | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| Subscription and services | $84.8 million | 77.2% | 1,300.4% |
| Transaction revenue | $24.3 million | 22.2% | 753.3% |
| Other | $702,000.00 | 0.64% | −88.8% |
Customers and how it sells
Circle’s direct institutional customers include businesses using Circle Mint to create, redeem, send and receive stablecoins. Applicants must supply information about their ownership, operations and intended use and pass identity, sanctions and other screening checks. Developers and enterprises also use Circle’s wallet, contract and interoperability tools to build applications.
The wider network includes consumer wallets, digital asset exchanges, custodians, banks, payment companies and liquidity providers. These businesses distribute, support or use Circle’s stablecoins in their own services. At the end of Q3 2026, CPN had 205 enrolled financial institutions. Visa is connecting Visa Direct to be funded in USDC, and Walmart’s finance subsidiary OnePay has added support for USDC.
Circle has banking integrations in more than 185 countries. Its regulated entities and licenses include operations in the European Union, Singapore, Bermuda, the United Kingdom and Abu Dhabi Global Market. Circle said Asia was a significant market for its platform, with cross-border settlement contributing substantial CPN volume there. It also provides institutional access to USDC liquidity in Hong Kong through banking partners.
In 2026, Circle agreed to acquire Tazapay, whose bank relationships and payout connections extend across Asia-Pacific and emerging markets. Circle expects the acquisition to close in 2027.
Suppliers and costs
Circle relies on financial institutions to hold and manage reserves and to connect its stablecoins with conventional banking. Settlement banks provide the primary liquidity infrastructure that lets funds move between Circle Mint customers and the stablecoin network. Circle holds reserves in accounts for the benefit of USDC and EURC holders and does not lend, borrow against or encumber them.
Distribution arrangements are another cost of expanding USDC use. Circle uses incentives to encourage digital asset platforms to support USDC. It said the sequential decline in net reserve margin in Q3 2026 reflected the first full quarter of its Hyperliquid arrangement. Circle also expects the first full quarter of its renewed Binance incentive arrangement to reduce margin in Q4 2026.
Circle’s cash operating costs and software development are part of its funding needs. In Q3 2026, adjusted operating expenses were $139 million, including continued investment in infrastructure for Arc and AI and in marketing. Circle expects capital expenditures and working capital requirements to increase as it expands products and services.
- Revenue$2.7B
- Cost of revenue−$1.7B
- Selling, general and administrative−$1.1B
- Other operating costs−$118.6M
- Operating income−$96.4M
Competitive position
Circle competes with other token issuers, payment services, digital wallet providers, blockchain infrastructure services, asset safekeeping services, banks and nonbank financial institutions. World Liberty Financial has announced a stablecoin, USDM1, in the same broad market as Circle’s stablecoins. Circle faces competition on price, reliability, ease of use, customer confidence and the range of services offered.
Circle said USDC carried 79% of stablecoin transaction volume in Q3 2026, on roughly 27% of the supply. It also reported $208 billion of USDC minting and redemptions in the quarter. USDC was integrated natively on 30 public blockchains at the end of 2025.
Our reading: USDC’s liquidity and extensive blockchain integration are meaningful competitive advantages because they give users ways to access and move the token. Their durability depends on Circle maintaining the banking and distribution relationships that support them.
Circle’s developer tools, CPN and Arc connect different participants and applications to its digital assets. Our reading: Those connections could reinforce the network as adoption grows, but Arc and CPN are newer businesses whose ability to generate recurring revenue remains less established than reserve income.
Circle publishes reserve reporting and third-party assurance and operates under multiple regulatory regimes. Our reading: Compliance and transparency can support institutional confidence, although they also entail ongoing costs and do not eliminate competition.
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| World Liberty Financial | Stablecoins | Medium |
Growth opportunities
Circle’s growth plans center on increasing the use and circulation of its stablecoins while expanding the services built around them. It invests in distribution partnerships, banking connections, developer tools and products intended to make digital assets useful in payments, treasury operations and capital markets. Circle expects growth in its network to increase stablecoins in circulation and support reserve income.
CPN is one avenue for expansion. At the end of Q3 2026, its annualized payment volume on a trailing 30-day basis reached $41 billion, up more than 15x year-over-year. Circle has extended its managed payments service to support payments from AI agents. It expects the planned Tazapay acquisition to add payout connections and capabilities to CPN, subject to the transaction closing.
Arc gives Circle another platform for financial applications. Mainnet launched on September 16, 2026, with 11 founding validators and more than 100 applications. Circle is developing features for payments, privacy and AI agents and expects to participate as a validator after Arc transitions to proof of stake.
Circle estimates the addressable market for money at about $120 trillion, including $60 trillion of noninterest-earning money. It also expects its newer products and services to diversify revenue over time. Circle’s results show that usage and circulation can move differently: Q3 2026 USDC onchain transaction volume grew 49% to $13.9 trillion, while circulation ended the quarter at about $74 billion, flat year-over-year.
- $1.5BFY2023
- $1.7BFY2024
- $2.7BFY2025
Structural risks
- Interest rates and circulation: Reserve income depends on stablecoins in circulation and the return on reserve assets. Fluctuations in interest rates can affect Circle’s operating results; in Q3 2026 a lower reserve return rate more than offset higher average circulation.
- Trust and redemptions: Stablecoins may experience uncertainty, loss of trust or systemic shocks that prompt rapid redemption requests. Disruptions in secondary marketplaces could also hurt acceptance of Circle’s stablecoins.
- Competition and distribution: Circle faces intense and increasing competition. If it cannot maintain or expand distribution and partnership arrangements on favorable terms, stablecoins in circulation and financial results could suffer.
- Regulation and compliance: Circle operates under extensive, evolving rules. Compliance brings costs and restrictions, and noncompliance can result in penalties, operational restrictions or lost licenses. The GENIUS Act will change the payment stablecoin ecosystem in ways that are not yet fully known.
- Operational and counterparty exposure: Technology disruptions at Circle, its service providers or partners could lead to lost customers or funds. Circle also faces risks involving banks and other counterparties, as well as the safeguarding of customer funds and digital assets.
Bottom line
Our reading
Circle is primarily a reserve-income business built around USDC, with payments and blockchain services intended to broaden its uses and revenue sources. Its liquidity and distribution give the network a base, but the economics remain exposed to interest rates, stablecoin circulation and the cost of partnerships. Newer services are growing, while their recurring contribution remains less established.