Circle's $60.25 Million Deal with Binance to Boost USDC Adoption

Stablecoin issuer Circle has disclosed a substantial partnership with cryptocurrency exchange Binance, involving a $60.25 million agreement aimed at promoting the adoption of USD Coin . This revelation comes from Circle's recent filing for an initial public offering with the U.S. Securities and Exchange Commission .

In November 2024, Binance became the first approved participant under Circle's stablecoin ecosystem protocol. As part of this two-year agreement, Binance committed to promoting USDC on its platform and maintaining a specified amount of USDC in its reserves. Circle compensated Binance with a one-time upfront payment of $60.25 million and agreed to provide monthly incentive fees based on the USDC balance held by Binance. These incentives are contingent upon Binance holding at least 1.5 billion USDC, with a general commitment to maintain 3 billion USDC, except under specific circumstances.

This strategic alliance is divided into two main components: marketing promotion and financial reserves, both spanning a two-year period. Should Binance choose to terminate the marketing promotion agreement prematurely, it is still obligated to fulfill one year of reduced-rate payments and continue its promotional activities. Both parties retain the right to terminate the agreement early under certain conditions.

Circle's IPO filing also sheds light on the company's financial performance. The firm reported revenues of $1.68 billion in the past year, an increase from $1.45 billion the previous year. However, net income from continuing operations declined to $157 million from $271.5 million, attributed to rising operating costs and significant expenditures on fees and transaction costs to partners like Coinbase.

USDC, introduced by Circle in 2018, has become the second-largest stablecoin and the seventh-largest cryptocurrency token overall. Stablecoins like USDC are designed to maintain a stable value by being pegged to traditional currencies, in this case, the U.S. dollar, and are backed by cash and cash equivalents, including short-term Treasury bonds.

The IPO represents Circle's second attempt to go public, following a previously terminated $9 billion merger with a special purpose acquisition company. J.P. Morgan and Citigroup are leading the underwriting for the IPO, with Circle expected to trade under the ticker "CRCL" on the New York Stock Exchange.