The recent agreement between Circle, Coinbase, and the decentralized exchange Hyperliquid has significantly altered the economics of the USDC stablecoin, immediately impacting the analytical assessments of a leading investment bank. JPMorgan has revised its revenue forecasts for both companies downward, citing the new profit-sharing model as a key risk factor.
The Essence of the Changes
In May, Coinbase and Circle updated their terms of cooperation with Hyperliquid. The American exchange now treats USDC held on the perp-DEX as an asset "on the platform" and earns income from the reserves of these funds. However, the exchange passes 90% of this amount on to Hyperliquid. Previously, Coinbase and Circle shared reserve income roughly equally. According to analysts, this scheme creates a "prisoner's dilemma," forcing partners to compete for USDC distribution.
Scale of Impact
Hyperliquid holds approximately $6 billion in USDC, accounting for about 8% of the total token supply in circulation. The exchange is among the largest trading venues in the crypto industry and leads among decentralized perpetual futures exchanges. In July, trading volume on the platform exceeded $150 billion, and its market share relative to Binance grew to 11.5%. This makes Hyperliquid a critically important counterparty for Circle and Coinbase.
Additional Pressure
In addition to structural changes, the companies are under pressure from the general weakening of the crypto market. Since March, Circle's stablecoin supply in circulation has decreased from $80 billion to $73 billion. The market capitalization of the entire "stablecoin" sector has shrunk by $10 billion since May. This exacerbates the negative effect of the new revenue distribution model.
Positive Signals from Japan
Nevertheless, there are also encouraging news. On July 14, Japan's largest payment system, JCB, signed a memorandum of understanding with Circle to develop solutions based on stablecoins. The companies plan to explore the possibility of using USDC for cross-border payments, domestic settlements, and payments for goods at Japanese merchants, including by tourists. The first phase will be a pilot for internal fund transfers at JCB. JCB serves approximately 140 million cardholders and over 40 million merchant locations worldwide. Additionally, Circle, together with Japan's Nomura, intends to launch a currency settlement service based on USDC for local companies in 2027.
These initiatives may partially offset the negative effect of the Hyperliquid deal, especially in the long term. However, as analysts rightly note, higher interest rates could support income from USDC reserves but do not solve the structural problem of dependence on key counterparties.
Expert Opinion: The Hyperliquid deal is a vivid example of how the growth of DeFi giants creates new risks for traditional players in the crypto industry. Circle and Coinbase find themselves in a vulnerable position where their own success in promoting USDC has led to the emergence of a powerful competitor dictating its terms. This could mark the beginning of a new era of income redistribution in the stablecoin ecosystem.