Circle Has USDC Revenue Sharing Deal With Second-Largest Crypto Exchange ByBit: Sources
Circle, the publicly traded issuer of the USDC stablecoin, has established a revenue-sharing agreement with Bybit, the world’s second-largest cryptocurrency exchange. This follows a similar, well-established model with Coinbase, where Circle shares 50% of the yield generated from USDC reserves. These agreements are strategically designed to incentivize exchange adoption of USDC.
While specifics of the Bybit arrangement remain undisclosed, the core principle mirrors Circle’s relationship with Coinbase and Binance. These partnerships reward exchanges for listing and supporting USDC by providing them with a share of the interest earned on Circle’s reserve assets. This strategy is particularly notable given the intensifying competition within the stablecoin market.
Circle’s pre-IPO filing offers insight into the financial structure of its arrangement with Binance. This involved a substantial upfront payment of $60.25 million, alongside a recurring monthly incentive. This incentive is a percentage of a fixed SOFR-linked rate, falling within the mid- to high-double-digit range, and directly tied to the amount of USDC held on the Binance platform.
The stablecoin landscape is increasingly competitive. USDC, with its approximately $62 billion in circulation, trails Tether’s USDT significantly, which boasts a market capitalization of around $160 billion. Emerging competitors, such as the Robinhood-backed Global Dollar (USDG), are employing similar revenue-sharing models to stimulate adoption.
Sources within the cryptocurrency infrastructure suggest that Circle’s revenue-sharing model extends beyond Coinbase and Binance, likely encompassing numerous exchanges with substantial USDC holdings. The implication is that any exchange with a significant volume of USDC likely operates under a similar agreement with Circle. Despite repeated attempts to reach Circle and Bybit for comment, neither company responded to requests.
