Author: @lufeieth
Edited by Wu Shuo Blockchain
TL;DR
- Circle has entered into USDC distribution partnership agreements with over 150 companies, driving USDC growth, product development, and distribution through economic incentives. For large enterprises capable of significantly expanding USDC adoption, Circle can also co-design partnership arrangements with Coinbase.
- Under Circle and Coinbase’s revenue-sharing arrangement, after deducting third-party ecosystem incentives approved by both parties, the remaining “ecosystem economic benefits” from USDC outside both platforms are split 50% between Circle and Coinbase.
- Hyperliquid’s partnership arrangement involves three parties: Coinbase, Circle, and Hyperliquid. As of the end of the quarter, approximately 90% of Hyperliquid’s USDC holdings were on the Coinbase platform, and approximately 10% were on the Circle platform; the corresponding on-chain balances are currently $4.952 billion and $550 million, respectively.
- The above 90%/10% refers to the allocation of USDC funds attributed to Coinbase and Circle platforms, and does not equate to the final profit-sharing ratio among the three parties. Circle has not disclosed its partnership with Hyperliquid or the precise revenue-sharing terms between it and Coinbase.
During Circle's (CRCL) Q2 2026 earnings call, management focused on addressing USDC distribution channel incentives, Circle's collaboration mechanism with Coinbase, and USDC yield allocation within the Hyperliquid platform.
Circle's CEO stated that the company has long incentivized partners through economic rewards to distribute USDC and build products around USDC. For large enterprises capable of significantly driving USDC growth, Circle has the capability to co-design collaborative arrangements with Coinbase.
However, Circle has not disclosed the exact revenue-sharing terms of the partnership with Hyperliquid. What can be confirmed from this earnings call is that Coinbase, Circle, and Hyperliquid are all participating in this collaboration; as of the end of the quarter, approximately 90% of Hyperliquid’s USDC holdings are on the Coinbase platform, and approximately 10% are on the Circle platform. This allocation of funds can also be observed via on-chain addresses.
Circle has entered into USDC distribution partnership agreements with over 150 companies.
Regarding the channel incentive program for USDC, Circle's CEO said:
We already have a large number of distribution incentive programs, and many partners are building on our network.
In fact, there are thousands of companies in our network. We have signed distribution partnership agreements with over 150 companies to drive USDC growth, develop products based on USDC, and distribute USDC.
We have been doing this for a long time. In fact, we often collaborate with Coinbase on initiatives like this.
In other words, incentivizing channel distribution of stablecoins by conceding part of the economic benefit is not a new idea that Circle adopted only after OUSD. Circle has long employed a similar model and has signed distribution partnership agreements with over 150 companies.
However, this does not mean that all channels integrating USDC will receive the same incentives, nor does it mean that Circle will distribute all related revenue to its partners. Circle will select core channels that drive USDC growth, development, and distribution, and design incentive distributions based on specific partnerships and use cases; the actual revenue-sharing ratios will vary by partnership.
Circle and Coinbase are willing to jointly introduce large distribution channels.
Circle CEO further stated on the conference call:
We are fully capable of establishing high-quality, mutually beneficial distribution partnerships with large enterprises. You just mentioned Hyperliquid, but there are other examples as well.
He also mentioned:
We are seeing strong interest from a large number of enterprises in joining the USDC network. We are seeing this around the world.
When we believe a company can substantially drive the growth and adoption of USDC, we have full opportunity to establish a corresponding partnership with Coinbase.
This means that Circle may still enter into third-party distribution incentive agreements with more large enterprises in the future. For example, with major platforms like Samsung Wallet, if they significantly drive the usage and distribution of USDC in the future, Circle and Coinbase may jointly develop corresponding collaboration mechanisms.
Coinbase and Circle do not have entirely opposing interests on this issue. Both have an incentive to first grow the overall USDC market through high-quality third-party channels capable of scaling USDC, and then distribute corresponding revenues according to existing agreements.
Under Circle and Coinbase's revenue-sharing arrangement, after deducting third-party ecosystem incentives approved by both parties, the remaining portion of USDC outside both platforms is referred to as "ecosystem economic interest," which is then split 50% between Circle and Coinbase. Therefore, incentivizing important third-party channels does not necessarily mean Circle bears the full cost alone; Circle and Coinbase can jointly participate in related collaborations.
How are the earnings from Hyperliquid distributed?
Autonomous analyst Ken Suchoski asked a question during the conference call:
On the Hyperliquid platform, 90% of the interest income goes to Hyperliquid. Do Circle and Coinbase split the remaining 10% equally?
Circle's CFO responded:
Regarding this partnership with Hyperliquid, Coinbase, Circle, and Hyperliquid are all involved.
Through on-chain data, you can accurately see where the funds on the Hyperliquid platform are located and whether those funds are credited to the Circle platform or the Coinbase platform.
As of the end of the quarter, approximately 90% of Hyperliquid’s total USDC holdings were on the Coinbase platform, and approximately 10% were on the Circle platform.
We will not comment further on the specific details of how Circle and Coinbase structure their revenue sharing arrangement.
The CFO's response confirmed that all three parties are involved in the collaboration arrangement with Hyperliquid, but did not directly confirm the specific revenue-sharing model raised by the analyst. The exact split and detailed terms among Hyperliquid, Circle, and Coinbase remain undisclosed commercial arrangements.
Here, two different sets of “90%/10%” must be distinguished: the “90%” mentioned by the analyst refers to the proportion of interest income received by Hyperliquid; the “90%/10%” cited by the CFO refers to the allocation of Hyperliquid’s USDC holdings between the Coinbase and Circle platforms. The latter does not equate to the final profit distribution among the three parties.
How to track Hyperliquid's USDC ownership on-chain?
The CFO mentioned that the location of USDC on the Hyperliquid platform, as well as whether the related funds are accounted for on the Circle or Coinbase platform, can be observed through on-chain data.
Currently, the USDC balance attributed to the Coinbase platform is $4.952 billion, corresponding to the Coinbase Treasury Deployer address on HyperEVM.
The USDC balance attributed to the Circle platform is $550 million, corresponding to the Circle CoreDepositWallet address on HyperEVM.
The AQAv2 system actively maintains USDC balances in the two addresses at approximately 90% and 10%. System transactions continuously rebalance the two addresses to remain close to a 1:9 ratio.
Therefore, when observing Hyperliquid's total USDC and its allocation between Circle and Coinbase, the following formula can be used:
Hyperliquid AQAv2 USDC ≈ Circle Core DepositWallet balance + Coinbase Treasury Deployer balance
The balance ratio between the two on-chain addresses is consistent with the end-of-quarter structure disclosed by the CFO during the earnings call: approximately 90% allocated to the Coinbase platform and approximately 10% allocated to the Circle platform.
The core of the USDC channel incentive is to jointly expand distribution scale.
From Circle’s management response, attracting third-party channels through economic incentives is not a temporary competitive strategy, but rather a key part of USDC’s long-term distribution mechanism. Circle has already entered into agreements with over 150 companies and is willing to work with Coinbase to design partnership arrangements for large enterprises that can substantially drive USDC growth.
Hyperliquid demonstrated how this model works in practice: a third-party platform is responsible for scaling the use of USDC, with Circle and Coinbase jointly participating in the arrangement, and funds within the platform allocated in a roughly 90% to 10% structure between Coinbase and Circle.
However, on-chain fund attribution can only help outsiders observe which platform USDC is credited to, but cannot directly determine the final profit-sharing ratio among the three parties. Regarding the specific split between Hyperliquid, Coinbase, and Circle, only a general framework is currently known; the precise terms have not been disclosed.