Circle Internet Group reported fourth-quarter 2025 revenue and reserve income of $770 million on February 25, 2026, a 77% increase from the same period a year ago and roughly $24 million above the $746 million analyst consensus. Net income came in at $133 million, up $129 million year over year. USDC in circulation reached $75.3 billion, a 72% jump, while onchain transaction volume hit $11.9 trillion for the quarter, a 247% increase that dwarfs anything the stablecoin sector has seen before.
The headline numbers look like a clean beat. Beneath them, the cost of keeping USDC on every exchange shelf in crypto tells a more complicated story.
$770 Million in Revenue, $448 Million Walking Out the Door
Circle's Q4 reserve income, the interest earned on the Treasury bills and cash equivalents backing every USDC token, totaled $733 million. That figure drove virtually all of the company's top line, with "other revenue" contributing just $37 million.
The problem is distribution. Circle paid $448 million in distribution costs during Q4, a 74% increase year over year. The bulk of that goes to Coinbase, which under a 2023 partnership agreement receives 100% of the interest income on USDC held directly on its platform and splits revenue 50/50 on USDC held elsewhere. In practical terms, Coinbase captured roughly 56% of all USDC reserve revenue in the 2024 fiscal year, and the structure has not materially changed.
That agreement renews in August 2026. Any renegotiation will be one of the most consequential contract talks in crypto, given that Coinbase effectively controls the distribution spigot for the second-largest stablecoin on Earth.
Adjusted EBITDA for the quarter was $167 million, a 412% increase that reflects genuine operating leverage. But the gap between gross revenue and what Circle actually keeps after paying distribution partners is the metric that bears are fixated on.
The T-Bill Dependency That Keeps Analysts Awake
Approximately 96% of Circle's revenue derives from Treasury bill interest. As of February 2026, T-bill yields have fallen nearly a full percentage point from their Q3 2024 peak. Every basis point decline translates directly into lower reserve income, and Circle has no mechanism to offset the drop beyond growing the total supply of USDC in circulation.
The math is straightforward: if USDC circulation grows 40% annually (Circle's own multi-year CAGR guidance) but T-bill rates fall 100 basis points, revenue growth stalls. Circle is running a spread business dressed up as a tech company, and the spread is set by the Federal Reserve, not by product decisions.
Full-year 2025 results underscore the tension. Revenue hit $2.7 billion (+64% year over year), but the company posted a net loss from continuing operations of $70 million, dragged down by $424 million in stock-based compensation tied to IPO vesting conditions. Adjusted EBITDA for the full year was $582 million (+104%), which strips out the non-cash expense but also strips out the economic reality that Circle's public market debut diluted existing holders.
USDC at $75.3 Billion: Market Share War in Real Time
USDC now commands 28% of the US dollar stablecoin market, as of the Q4 report. Tether's USDT sits at roughly 64% with $186 billion in circulation. Together they account for 93% of all stablecoin market cap.
The growth gap is narrowing. USDC's supply grew 73% in 2025 versus 36% for USDT, marking the second consecutive year where Circle has outpaced Tether in percentage terms. The GENIUS Act, signed into US law in 2025, created a regulatory framework that favors fully-reserved, US-domiciled stablecoins, and Circle has leaned into that advantage aggressively.
Meaningful wallets holding USDC reached 6.8 million, up 59% year over year. The euro-denominated EURC stablecoin hit 310 million euros in circulation, a 284% increase that positions Circle as the default regulated stablecoin issuer across both the US and EU markets.
Circle's tokenized fund product, USYC, reached $1.5 billion in assets, placing it in direct competition with BlackRock's BUIDL in the tokenized Treasury space.
The Payments Network Nobody Is Talking About
Buried in the earnings release is a data point that may matter more than the quarterly revenue beat: Circle Payments Network now has 55 enrolled institutions processing $5.7 billion in annualized transaction volume. The Arc testnet logged over 166 million transactions with near-100% uptime across more than 100 participants.
If Circle Payments Network scales, it transforms the company from a passive T-bill yield harvester into an active payments rail. The 2026 guidance reflects this ambition: Circle expects "other revenue" of $150 million to $170 million, a roughly 4x increase from 2025 levels, with adjusted operating expenses of $570 million to $585 million.
That guidance implies Circle is betting it can grow non-reserve revenue fast enough to offset any T-bill yield compression. Whether the market believes that bet will determine where CRCL stock goes from here.
What This Means for Stablecoin-Funded Crypto Cards
USDC is the default funding token for a growing number of crypto card issuers. RedotPay, Bleap, KAST, and ether.fi all rely on USDC as a primary or exclusive loading currency. Circle's financial health directly affects the infrastructure these card products depend on.
The distribution cost dynamic also matters at the card level. When Circle pays Coinbase to hold USDC, that cost gets absorbed into the stablecoin ecosystem's economics. If distribution costs continue rising, the margin available for card issuers to offer cashback rewards or absorb FX conversion spreads tightens.
EURC's 284% growth is particularly relevant for European cardholders. A liquid, regulated euro stablecoin reduces the FX conversion step that currently adds 0.5% to 1.7% in hidden costs when EEA users load USDC and spend in euros. As EURC adoption grows on card platforms, that friction should decline.
The broader signal from Circle's earnings is that the stablecoin layer of crypto is becoming a mature, publicly traded business with real revenue, real costs, and real sensitivity to macroeconomic rates. The era of treating USDC as free infrastructure is over.
FAQ
How much revenue did Circle report for Q4 2025? Circle reported Q4 2025 revenue and reserve income of $770 million, a 77% increase from Q4 2024. Net income was $133 million. The company beat the analyst consensus estimate of approximately $746 million.
Why are Circle's distribution costs so high? Circle pays distribution partners, primarily Coinbase, to hold and promote USDC across their platforms. Under a 2023 agreement, Coinbase receives 100% of interest income on USDC held on its platform and 50% of income on USDC held elsewhere. Total Q4 distribution costs reached $448 million, up 74% year over year.
How much USDC is in circulation? USDC reached $75.3 billion in circulation as of Q4 2025, up 72% year over year. It holds approximately 28% of the US dollar stablecoin market, second to Tether's USDT at roughly 64%.
What is Circle's main revenue risk? Approximately 96% of Circle's revenue comes from interest on the Treasury bills backing USDC. Falling T-bill yields directly reduce revenue, and Circle has limited ability to offset rate declines beyond growing USDC's total supply.
Is Circle a public company? Yes. Circle Internet Group trades on the NYSE under the ticker CRCL. The company went public via IPO in mid-2025. As of February 2026, the stock is down approximately 26% from its IPO price.
Overview
Circle's Q4 2025 earnings report delivered a clean revenue beat at $770 million (+77% YoY) with USDC circulation reaching $75.3 billion and onchain transaction volume surging 247% to $11.9 trillion. Adjusted EBITDA jumped 412% to $167 million, showing real operating leverage. The counterweight is structural: 96% revenue dependence on T-bill rates, $448 million in quarterly distribution costs (mostly to Coinbase), and a full-year net loss of $70 million after IPO-related stock compensation. Circle Payments Network (55 institutions, $5.7B annualized volume) and the EURC stablecoin (310M euros, +284%) represent the company's best path to diversifying beyond passive yield. For the stablecoin-funded crypto card ecosystem, Circle's financial trajectory is now a macroeconomic variable, not just infrastructure.
Recommended Reading
- Tokenized US Treasuries Cross $10 Billion as Circle Edges Out BlackRock
- Coinbase Stablecoin Revenue Could Surge Sevenfold Under the GENIUS Act
- Mastercard Is Hiring a Director of Crypto Flows to Build DeFi Rails
