JPMorgan revises forecasts for Circle and Coinbase: Hyperliquid changes the rules of the game in the stablecoin market
Events surrounding Hyperliquid are gaining momentum, and now they directly affect two key industry players — Circle and Coinbase. Analysts at JPMorgan, closely monitoring market dynamics, have decided to lower profit forecasts for both companies, and there are compelling reasons for this. At the center of attention is a new agreement with Hyperliquid that is changing the traditional economics of the USDC stablecoin.
New Economic Model: Who Benefits?
In May 2025, Coinbase and Circle revised their partnership terms with Hyperliquid — one of the largest decentralized protocols for trading perpetual futures (perp-DEX). Under the updated scheme, Coinbase now treats USDC held on Hyperliquid as an asset located "on the platform." This allows the exchange to earn income from the reserves of these funds, but then 90% of this amount is passed on to Hyperliquid itself. Previously, Coinbase shared this income almost equally with Circle, which was standard practice.
This redistribution of benefits significantly shifts the balance of power. Hyperliquid, which holds about $6 billion in USDC — roughly 8% of the total circulating supply of the token — becomes not just a client but a key beneficiary. In July, trading volume on this platform exceeded $150 billion, and its share relative to Binance grew to 11.5%. This makes Hyperliquid a dominant force in the decentralized derivatives market.
"Prisoner's Dilemma" for Circle and Coinbase
JPMorgan described the current situation as a "prisoner's dilemma." The essence is that Circle and Coinbase, traditionally partners in promoting USDC, now find themselves in a competitive race for stablecoin distribution. Each company may try to offer Hyperliquid more favorable terms to maintain or increase its share of income. This creates risk for both players, as such competition could lead to lower margins.
Additional pressure comes from the overall weakening of the crypto market. Since March, the volume of USDC in circulation has decreased from $80 billion to $73 billion, and the market capitalization of the entire stablecoin sector has dropped by $10 billion since May. This indicates declining demand for "stablecoins" amid uncertainty. However, JPMorgan notes that in the long term, higher interest rates could partially support income from USDC reserves, somewhat mitigating the negative effect.
Japanese Vector: New Horizons for USDC
Against this backdrop, it is interesting to observe Circle's actions in Japan. On July 14, the country's largest payment system, JCB, signed a memorandum of understanding with Circle. The companies plan to jointly develop solutions based on stablecoins, including cross-border payments, domestic settlements, and payments for goods at Japanese merchants, including for tourists. The first phase will be a pilot for internal fund transfers at JCB.
Given that JCB serves about 140 million cardholders and over 40 million merchant locations worldwide, this could become a significant driver for USDC adoption. Additionally, at the end of June, Circle announced plans to launch a currency settlement service based on USDC for local companies in partnership with Nomura, with a launch date in 2027.
As an expert, I believe the situation with Hyperliquid is a warning signal for the entire stablecoin ecosystem. If one major player can dictate terms and redistribute income in its favor, it sets a precedent that could undermine trust in USDC as a neutral asset. At the same time, Circle's Japanese expansion shows that the company is seeking alternative growth paths, but the success of these initiatives will depend on whether Circle can maintain control over its economic model amid growing competition.