Circle defends USDC earnings as rivals offer partners a bigger share of reserve income
Circle, the company that issues the USDC stablecoin (a digital token designed to stay worth one dollar), is defending its business model after rivals began offering its partners a larger share of the money earned on stablecoin reserves. In a blog post on Friday, the company laid out its first-half 2026 finances to argue that its costs are real and that its partner payments already reflect them.
The dispute is about who keeps the interest earned on the cash and other safe assets held behind stablecoins. Competing networks are promising businesses a bigger cut of that income, and some of Circle's own partners are backing those rivals.
Circle kept about 7 cents of each revenue dollar
- Circle said it earned about $1.4 billion in revenue in the first half of 2026 and kept roughly 7 cents of each dollar as net profit.
- Distribution and transaction costs came to $819 million, while the remaining $473 million covered compliance, liquidity and product development.
- That $473 million figure included about $214 million in stock-based compensation and related costs.
What the Circle blog post argues
Kash Razzaghi, Circle's chief commercial officer, published the figures on the company's blog. The post did not name any rival directly, but its target was clear: networks that say stablecoin users should receive more of the reserve income.
Circle's counterargument is that reserve income has to pay for more than profit. "The costs of redemption, compliance, and resilience don't disappear just because the issuer declined to pay them," Razzaghi wrote. In plain terms, someone has to cover the cost of letting people swap tokens back for dollars, following rules, and keeping the system running smoothly.
Circle also said that standard USDC redemptions remain free and "typically settle in up to two business days." It added that qualifying platform customers and payment flows through its Circle Payments Network can now redeem at no cost and near real-time speed.
Rivals offer partners a bigger share
The main competitor described in the reporting is Open USD, a network unveiled in June that was backed by Stripe, BlackRock and Coinbase. Its OUSD token is now live. The network aims to let businesses mint (create) and redeem stablecoins without fees, and to pass reserve income to participants after deducting a management fee.
The awkward part for Circle is that Coinbase, its largest USDC distribution partner, is also a backer of Open USD. Open USD is not the only player in this space; the Paxos-led Global Dollar Network (USDG) also shares reserve income with participants.
Circle is signing new distribution deals
Circle has been working to add partners who put USDC into circulation. In September, Binance bought a $100 million stake in Circle under a five-year agreement that includes a fee tied to USDC held through Circle's wallet service.
What is confirmed and what remains unclear
Circle's financial figures come from the company's own blog post and are not presented as independently audited in the supplied material. The existence, backers and revenue-sharing design of Open USD, and Binance's $100 million stake, are reported by CoinDesk. Circle did not name Open USD or any competitor in its post, so its criticism should be read as a general defense of its model rather than a direct response to a specific rival. How much reserve income participants actually receive under these rival networks, and whether businesses will shift away from USDC, is not addressed in the sources.
Why the split over reserve income matters
Stablecoin issuers make money mainly from the interest on the assets held behind their tokens. How that income is shared determines what exchanges, payment firms and other distributors earn, and therefore how much they push one stablecoin over another. Circle's argument is that its costs justify its current split; rivals are betting that businesses want a larger share. Coinbase's support for both USDC and a rival network shows how fluid those loyalties are.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.
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