Circle's Recent IPO Filing Revealed the Company Makes Less Money from USDC Than Coinbase

The recent IPO filing of cryptocurrency firm Circle has revealed that the company makes less money off the USD Coin (USDC) stablecoin than cryptocurrency exchange Coinbase.

Cryptocurrency firm Circle, known for its USD Coin (USDC) stablecoin, recently filed for an initial public offering (IPO), revealing that it generates less revenue than cryptocurrency exchange Coinbase despite a significant distribution expense to the exchange.

According to Circle's IPO filing, its largest expense was $908 million paid to Coinbase for distribution. This is in comparison to Coinbase's reported revenue of $7.0 billion in 2024. For perspective, transaction fees alone contributed to $5.0 billion of the exchange's total revenue last year.

Further analysis of the filing shows that Circle is estimating a staggering $414 million loss in net income if the Federal Reserve were to decrease interest rates by 200 basis points from their current level.

The stablecoin issuer is also highlighting the stellar growth of USDC, which saw its circulating supply skyrocket by more than 78%. Its market cap now stands at $60 billion, making it the second-largest stablecoin.

The IPO filing also showcases the vast volume of transactions facilitated by USDC, which has seen an incredible $25 trillion in lifetime on-chain transaction volume. More than $1 trillion worth of tokens have been minted and redeemed since the token's inception, and it is currently available on a total of 19 blockchains with native blockchain issuance.

In terms of revenue, Circle has seen a significant year-over-year increase, with revenue more than doubling from 2022 to 2024 ($772 million to nearly $1.7 billion). The company also managed to secure a $221.6 million profit last year, which is a stark contrast to the whopping $758 million loss it posted in 2022 during the brutal bear market.

For those unfamiliar, Circle generates revenue through interest on the reserves that back USDC, while Coinbase typically earns revenue from transaction fees charged on cryptocurrency trades executed on its platform.

Coinbase recently reported its Q4 revenue, which came in at an impressive $2.3 billion. Of this sum, transaction fees made up the majority, specifically $2.2 billion, while subscriptions and services generated $684 million.

Circle's IPO filing comes amid a burgeoning competitive landscape in the cryptocurrency sector. As blockchain technology rapidly advances, new use cases for cryptocurrencies are continually emerging, presenting fresh revenue opportunities for innovators in the space.

In addition to Coinbase, PayPal and Ripple have also launched their own highly regulated stablecoin products, aiming to capitalize on the growing demand for digital currencies.