Circle Internet Group Q2 2025 Earnings Report

Circle Internet Group EPS Results

• Actual EPS: N/A
• Consensus EPS: $0.34
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Circle Internet Group Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $645.35 million
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Circle Internet Group Announcement Details

• Quarter: Q2 2025
• Date: 8/12/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, August 12, 2025
• Conference Call Time: 8:00AM ET

Founded in 2013, Circle's mission is to raise global economic prosperity through the frictionless exchange of value. We intend to connect the world more deeply by building a new global economic system on the foundation of the internet, and to facilitate the creation of a world where everyone, everywhere can share value as easily as we can today share information, content, and communications. Since inception, we have relentlessly pursued our mission and vision, building fundamental technology for the internet financial system. We have forged paths toward mainstream acceptance through persistent and active engagement with policymakers and regulators globally, and have seen institutional and consumer knowledge and acceptance of internet-native financial assets approach critical mass. Large and influential players in the incumbent financial services system are increasingly embracing digital assets broadly and stablecoins specifically. Circle's innovative products reach tens of millions of end-users, power thousands of businesses, and, as of March 31, 2025, USDC has been used for more than $25 trillion in onchain transactions. While we have made strong progress in our pursuit of our mission and vision over the past decade, we believe the internet financial system is in its infancy with decades of growth and innovation ahead. Our principal executive office is located in New York, NY.

Circle Internet Group Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: USDC growth accelerated: USDC supply reached $61.3 billion at Q2 end (+90% YoY) and $65.2 billion by August 10 (+49% YTD), while on-chain transaction volume rose 5.4× YoY to nearly $6 trillion.
• Positive Sentiment: Product launches expand network: Circle introduced the Payments Network with active corridors in Hong Kong, Brazil, Nigeria and Mexico (100+ firms in pipeline), launched Gateway for seamless cross-chain USDC, and unveiled Arc, its Layer 1 blockchain using USDC as gas with enterprise-grade performance.
• Neutral Sentiment: Q2 revenue and reserve income rose 53% YoY to $658 million, with adjusted EBITDA up 52% to $126 million (50% margin); revenue less distribution costs (RLDC) margin was 38% amid higher partner incentives.
• Positive Sentiment: Regulatory tailwinds: The passage of the Genius Act is viewed as a catalyst, driving accelerated institutional interest and laying groundwork for broader stablecoin adoption by banks, enterprises and tech firms.
• Neutral Sentiment: Circle’s financial model combines reserve income on USDC backing assets with growing high-margin transaction fees from CPN, Circle Mint and USYC, underpinned by a long-term target of 40% CAGR in USDC growth.

Presentation

[Operator]

Hello, and thank you for standing by. My name is Tiffany, and I will be your conference operator today. At this time, I would like to welcome everyone to the Circle Internet Group Q2 twenty twenty five Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.

[Operator]

I would now like to turn the call over to John Andrews, Vice President of Capital Markets and Investor Relations. John, please go ahead.

[John Andrews, Head - Capital Markets & IR at Circle Internet Group]

Good morning and welcome. This is John Andrews, VP of Capital Markets and Investor Relations at Circle, and I'd like to welcome you to our second quarter twenty twenty five earnings conference call. We are excited for all of you who have joined us this morning as we take another key step on our journey as public company with our first earnings call. I'm joined by Jeremy Allaire, our Co Founder, Chief Executive Officer and Chairman and Jeremy Foxkeen, our Chief Financial Officer. Earlier this morning, we posted our earnings press release and earnings presentation on the Circle Investor Relations website, investor.circle.com.

[John Andrews, Head - Capital Markets & IR at Circle Internet Group]

A transcript of this call will be posted on that website once available. I do need to remind everyone that our earnings release, presentation and this call contain statements that are forward looking. Because forward looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and some of which are beyond our control, we should not rely on these forward looking statements as predictions of future events. The events and circumstances reflected in our forward looking statements may not be achieved or occur, and actual results could differ materially from those projected in that forward looking statement. Information concerning risks, uncertainties and other factors that could cause these results to differ is included in our SEC filings.

[John Andrews, Head - Capital Markets & IR at Circle Internet Group]

We will also disclose non GAAP financial measures in the call today. Definitions of those non GAAP financial measures and reconciliations to the most comparable GAAP financial measures can be found in the earnings release and earnings presentation that are available on our Investor Relations website at investor.circle.com. Non GAAP financial measures should be considered in addition to, but not as a substitute for GAAP measures. With that out of the way, it's with pleasure. Let me turn it over to Jeremy Allaire.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Thank you, John. I'm pleased to be here this morning. It's been an honor to bring Circle public and host our first earnings call. We are thrilled to work with so many world class people, partners and investors. We started this company twelve years ago with an ambitious mission to build a new Internet financial system with blockchains and digital currency that could increase global economic prosperity through the frictionless exchange of value.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We and the entire market are in the early stages of that vision, literally graduating from the early adopter phase of block chain technology and digital currency into the mainstream adoption phase that is accelerating. I want to start with some key highlights from 2025. USDC, the core of our stablecoin network, has grown to $61,300,000,000 at June 30, and growth has accelerated into Q3 to sixty five point two billion dollars in circulation as of August 10, representing approximately 90% year over year growth and 49% growth year to date, making USDC the fastest growing major stablecoin over the past year. In Q2, USDC on chain transaction volume grew 5.4x year over year to nearly $6,000,000,000,000 Our transaction volumes have also accelerated into Q3 with $2,400,000,000,000 in transactions in July alone. We have been rapidly expanding Circle's platform and network with major new products, including Circle Payments Network, which we believe will become a breakthrough in global money movement by building an on chain native payments network that will move money faster and more efficiently and opens up new utility through programmable payments Circle Gateway, which enables seamless cross chain USDC experiences eight new blockchain partners and ARC, our new Layer one blockchain network, which we are announcing today.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

More on that later. Post IPO and Genius Act, we are experiencing rapid expansion in commercial opportunities with major mainstream companies across every sector of finance and technology, including companies from all around the world. And from a corporate mission perspective, we joined Pledge 1%, a global movement for corporate impact. To honor this commitment, prior to the IPO, we reserved 2,700,000.0 shares of our Class A common stock for future donations to our Circle Foundation. As we look at the overall stablecoin market, we believe that the total addressable market for stablecoins and our products is massive, with dollar stablecoins only representing a mere 1% of The U.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

S. M2 money supply, but with continued rapid growth in stablecoin supply. Today, Circle operates the largest regulated stablecoin network in the world. We talk about this a lot. Stablecoins are network businesses and have meaningful network effects.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Growth of our Stablecoin network is driven by our platform, our blockchain protocols, and the developers building applications and services on our network. That expands the Circle on chain ecosystem and is the classic flywheel that has driven the growth of our Stablecoin network since its launch in 2018. Like other Internet platforms and network businesses, stablecoins are a winner take most market as liquidity and utility complement each other and drive growth. There have been many regulated and unregulated dollar stablecoins and many more to come, but the strength and resiliency of Circle's network effects positions us well to compete and grow. Turning to the regulatory environment, Circle's market and competitive strength is further cemented with the signing of the Genius Act, creating powerful tailwinds for Circle.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We believe this law will accelerate stablecoin adoption by major financial institutions, mainstream enterprises, technology companies, and ultimately drive much broader use of stablecoins across retail and wholesale payments as well as broader usage in trad fi capital markets. This is likely the catalytic moment for the mainstream scaling of stablecoins, and we are already seeing this in our business momentum. Turning to our products and platform. We are continuing to make progress with our core digital asset products USDC, EURC and USYC. With USDC, we expanded our distribution onto eight new blockchain networks in 2025 and significantly expanded CCTP version two availability, both of which continue to cement USDC as the most liquid and available on chain dollar stablecoin.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We also now offer a yield token, USYC, that can be used in both digital asset and traditional capital markets as collateral with twenty fourseventhree sixty five liquidity between USYC and USDC. We're now executing that strategy, driven by our expanded partnership with Binance, who will now make USYC available as collateral, unlocking a very powerful use of USYC on the largest exchange in the world, and we're already seeing accelerating adoption there. We've continued to expand our core banking and liquidity capabilities, including with multiple GSIBs, strengthening our unrivaled industry position. During Q2, we undertook the launch of one of the most ambitious new product investments, Circle Payments Network, our initiative to transform international money movement, which today already has active payment corridors in Hong Kong, Brazil, Nigeria and Mexico. We have rapidly grown our pipeline of financial institutions interested in launching on CPN to over 100 firms.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We have an ambitious roadmap and will continue to expand CPN's features and use cases from international money movement to other types of payments such as consumer and B2B payments and still further into global capital markets and corporate treasury services. We're incredibly excited to see this level of interest so soon after CPM's launch. In July, we introduced Circle Gateway, which abstracts away the complexity of holding USDC on different blockchains and in different wallets, streamlining usability and speeding transactions that use USDC. This is a key building block in bringing USDC into more mainstream financial and payment applications and creates new monetization opportunities for Circle. Now, I'd like to turn to a very special and major new platform initiative that we are announcing today, Arc.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Arc is a new blockchain network from Circle that we will launch in the second half of the year. We are at the fulcrum of a massive mainstream embrace of stablecoins in the financial system, and firms are racing to build on this infrastructure. But until now, the blockchain infrastructure needed to meet the most intense demands of major financial firms and enterprises has simply not existed. We are delivering that infrastructure with Arc. Arc is a new Layer one blockchain that is compatible with Ethereum infrastructure but operates as a standalone network.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Some key facts about ARK. We wanted to create a way for institutions to pay fees on blockchains in a fast, predictable manner that would be simple from an accounting perspective and could deliver very low cost and stable fees. So with ARK, we are using USDC itself as the native gas fee currency. This removes the complexity of paying transaction fees in a native token. ARC offers enterprise grade performance and real settlement finality.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Financial institutions and regulators expect deterministic finality, which ARC will achieve with Circle vetted professional validators and its novel consensus mechanism. ARC will also offer configurable privacy controls with opt in confidential transfer features, which is essential for real world business and financial applications, and also supports regulatory compliance. And finally, ARC will be integrated across Circle's entire product portfolio and will also provide best in class USDC liquidity and interoperability across the wide range of blockchain networks we already support. We are very excited about ARC and have shared more information, including a brief paper and platform details, on circle dot com and the ARC website. Now let's turn to growth and adoption.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Just in the past few months, we've seen incredible engagement and interest in working with Circle from major firms in every sector of the financial system, as well as Internet and technology companies, and this is consistent and accelerating all around the world. I'd like to highlight a few examples from our recent periods. In digital assets, we've launched and expanded key partnerships with Binance and OKX, two of the largest exchanges in the world. With Binance, we've significantly expanded our partnership to include broader use of Circle technology. We're also continuing to see strong traction and partnerships in DeFi, including our planned launch of USDC on Hyperliquid, one of the fastest growing on chain exchanges and ecosystems.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Major cross border payment firms like Remitly, MoneyGram and Zeps are integrating USDC into their payment networks, and Stripe made USDC central to its new global stablecoin financial accounts for businesses. Visa, Mastercard and others have publicly announced new products and plans that would expand availability and usage of USDC on their networks. I'm particularly excited that banking and payments infrastructure providers like Matera, Fiserv, FIS and CorePay all announced deals with Circle to add stablecoin capabilities and our technology into their product infrastructure that combined serves tens of thousands of banks and financial institutions. Now turning to digital asset trading markets, which continue to remain a key priority and a significant growth opportunity for Circle. Since we launched initiatives to drive USDC in the digital asset markets in early twenty twenty four, our share of spot trading volume has grown from 1% to 10% in Q2.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And through our partnerships and growth initiatives, we are highly focused on continued market share gains. Digital asset firms globally are focused on working with the most trusted and compliant leader in stablecoins. To summarize, let me reiterate the advantages of our stablecoin network. Circle is uniquely positioned to lead in the mainstream adoption of blockchain and Stablecoins. Our platform powers developers, enterprises and institutions to build on the Circle Stablecoin network, leveraging our deep liquidity infrastructure and seamless global bank connectivity.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We provide primary liquidity in every major financial center and have facilitated over $1,000,000,000,000 in USDC issuance and redemption since 2018. With Internet scale distribution across wallets, payment providers, banks and exchanges worldwide, Circle is becoming the default choice for institutions selecting stablecoin network. Our market neutral model invites broad adoption of our platform from even the most competitive players. Our trusted regulated status and long standing policy engagement capped by the passage of the Genius Act fortifies our position as the industry's most reliable foundation. Together, these strengths create powerful competitive bulwarks and network effects that compound, driving exponential growth for Circle.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

With that, I will turn things over to our CFO, Jeremy Fox Gein.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Thank you, Jeremy, and good morning, everyone. I'm excited to be here with you all for our first earnings as a public company. I'll start by walking briefly through the fundamentals of our business and financial model and then turn to the financial and operating results for the quarter. As Jeremy noted, stablecoins are network businesses with Internet scale potential. Successful networks are valuable and enduring, and our strategy is to build the largest stablecoin network.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

We make money in two ways. First, we monetize the money stock on the network through reserve income, which we earn on the cash equivalent assets we hold to back our stablecoins. And we are also starting to monetize certain transaction flows and elements of our network infrastructure. While these other revenues are small today, they are growing, are high margin and also have the potential to scale rapidly with network adoption and usage. Finally, we are an Internet platform business with a highly scalable model and inherent operating leverage with the potential to deliver strong profit growth and margin expansion over time.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Let me now review the quarter. Circle's stablecoin network continues to grow strongly. USDC on chain transaction volume was up 5.4 times year on year. CCTP volume showed similar growth, up 4.1 times year on year, demonstrating the importance of blockchain interoperability. Meaningful wallets defined as wallets holding more than $10 of USDC were up 68% year on year as USDC adoption continues to expand globally.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

USDC in circulation stood at $61,300,000,000 at quarter end, up 90% year on year and was at $65,200,000,000 as of August 10, up 6.4% since quarter end. USDC held within Circle's platform infrastructure grew 10 times year on year, reaching 10% of total circulation at quarter end as more partners build using our platform infrastructure. The reserve return rate was 4.14% for the second quarter, reflecting the decline in SOFA during this period. Total revenue and reserve income increased 53% year on year to $658,000,000 in the second quarter as growth in USDC and circulation was partly offset by a lower reserve return rate. Total distribution transaction and other costs increased 64% year on year to $4.00 $7,000,000 The increase was driven by higher average USDC balances held on Coinbase's platform and other partner incentives as we continue to build and grow partnerships to drive USDC growth and adoption.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

As a result, our revenue less distribution cost margin was 38% in the second quarter. Other revenue increased to $24,000,000 in the second quarter, up 3.5 times year on year. This was primarily driven by a $13,000,000 increase in subscription and services revenue, mostly from our blockchain network partnerships. Transaction revenues grew strongly to $5,800,000 in the second quarter, up from $1,600,000 in Q1. Our other revenues carry a higher margin than our net reserve margin and added 2.2 percentage points to margin overall in the second quarter.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Total revenue and reserve income less distribution transaction and other costs was $251,000,000 in the second quarter, 38% year on year. Adjusted operating expenses, which excludes depreciation and amortization, non operating digital asset gains and losses and stock based compensation were $128,000,000 for the quarter, as we continue to invest in growing our platform at this pivotal moment for our industry. Adjusted EBITDA was $126,000,000 in the quarter, up 52% year on year and delivering a 50% adjusted EBITDA margin, reflecting the strong operating leverage inherent in our business model. Now let me turn to our outlook. Our goal is to help investors and analysts understand our business and how we manage it as best as possible.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

We are at the beginning of meaningful structural shifts in the global markets for money, and we are managing our business for long term success. As such, we do not intend to give short term quarterly guidance. We do intend, however, to give full year guidance on certain key metrics. We will evolve this guidance each quarter with our financial results as needed. USDC in circulation is not a forecastable metric in the traditional sense and is in many ways the outcome of an entire economy of activity.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

There is a growing body of third party research on stablecoin growth with multi year forecast CAGRs ranging from 25% to 90% with a median of 60%. Our core model anticipates multi year through cycle USDC growth of a 40% CAGR, reflecting our conservative nature. We anticipate other revenue to range between $75,000,000 and $85,000,000 for 2025, primarily driven by subscription and services revenue from our blockchain network partnerships, which can vary quarter on quarter, along with transaction revenues, which are small today, but growing. We anticipate an RLDC margin of between 3638% for 2025. While RLDC margin for the first half of the year was 39%, we continue to invest in partnerships with industry leading institutions to grow USDC adoption.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Adjusted operating expenses we expect will range between $475,000,004 $90,000,000 in 2025, as we continue to invest in key areas to build out our platform, our capabilities and our global partnerships. This would represent a full year growth rate of between 2024%. In closing, we have had a strong first half and are executing at an accelerating pace against the significant opportunity in front of us. Thank you to our investors and analysts for your support and engagement, and we look forward to updating you on our progress next quarter. With that, operator, we can now start the Q and A portion of the call.

[Operator]

We kindly ask that you limit yourself to one and one follow-up for today's call Your first question comes from the line of Joseph Vafi with Canaccord. Please go ahead.

[Joseph Vafi, MD - Equity Research at Canaccord Genuity - Global Capital Markets]

Hey, Jeremy and Jeremy, great results here and congrats on your IPO, which was obviously a great success and your first earnings call. Just a couple for me. One, the news on ARC, obviously very exciting. Do you believe that the gas fees and the like are the first step here in the revenue model for USDC or maybe for transactions away from trading pairs and the like is ARC going to be and the gas fee is going to be kind of the basis for transaction fees here for broader transactions with USBC? And I have a quick follow-up.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Sure. Thanks, Joe. Look, a few things here. First, we're very excited about ARC. There's a lot more information out about it.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

ARC, we want to underpin all stablecoin finance payments, FX, capital markets applications, and it's really designed to support mainstream regulated financial institutions who want to build on chain and build financial products and services on chain. And so we're excited and we believe that a lot of traffic can move on to a network like ARC. And yes, the gas fees, which are denominated in USDC, can become a source of revenue. And we'll certainly as this goes into test net and ultimately launches on main net, we'll have a lot more to say about that. But I would also say just to contextualize it, we have a number of transaction fee revenue streams that are emerging.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And Jeremy referred in his remarks to the kind of growth in transaction fee revenue, which was very solid on an annualized basis we're continuing to see. So many new products and services that we're building include transaction fee components to them. And of course that includes CPN as we scale that and includes premium features of Circle Mint. It includes features of USYC, our yield token. And so we're adding more and more transaction fee models.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

But you are correct that ARC does have an underlying gas fee transaction fee model built on USDC.

[Joseph Vafi, MD - Equity Research at Canaccord Genuity - Global Capital Markets]

Great. Thanks, Jeremy. And then just on the USYC theme, maybe drill down a little bit on that expanded relationship there with finance with a focus on USYC and maybe just a little color on expanding that into USYC and not just USB? Thanks a lot.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Sure. A couple of things of note. So as noted in my comments, we have expanded our partnership with Binance. That includes both around USDC and USYC. With USDC, they're continuing to adopt Circle Wallet technologies.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

They're more they're they're sort of deeper support and integration with Circle's wallet technology, which is going to help promote and grow the use of USDC on their platform. And so they've been a great partner and they're leaning into both the technology and really driving USDC growth. The partnership around USYC is really important. When we acquired the product and then very recently relaunched the product, we designed it to be something that could be used as a yield bearing collateral instrument. And when you look at global exchanges today and Binance is the largest global exchange, there's an enormous amount of collateral posted in those markets.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And we believe that as institutionalization takes hold, that the big trading firms, asset managers, institutions are going to want to post yield bearing collateral, but then actually trade with USDC. And so the integration between USYC as yield bearing collateral and USDC as digital cash that can be used as a relative margin and in spot markets and the like. It's a powerful market structure. The fact that we're doing this with the biggest exchange in the world is really significant and we hope and expect that we will deploy this kind of architecture in more digital asset exchanges and ultimately on major traditional clearinghouses. Earlier in the year, we announced a collaboration with ICE And within the context of that, the goal is to stand up the ability to support yield bearing collateral like USYC, USDC as cash and settlement.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And so, this new twenty fourseventhree sixty five market structure where you can seamlessly move between tokenized yield bearing collateral and cash, we think it's the future of financial markets. And we're obviously excited about pioneering an implementation of that vision with the largest digital asset exchange in the world.

[Joseph Vafi, MD - Equity Research at Canaccord Genuity - Global Capital Markets]

Great. Congratulations again, Terry.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Thank you.

[Operator]

Your next question comes from the line of Pete Christiansen with Citi. Please go ahead.

[Peter Christiansen, Director at Citi]

Good morning. Thank you. And certainly, we echo our congratulations on a very, very successful IPO. It's been a long road for you guys, so congratulations. Jeremy, I wanted to ask, and we get this question quite a bit from investors, is trying to understand, the transaction volume versus the circulation.

[Peter Christiansen, Director at Citi]

Obviously, transaction volume growing way faster. So the question kind of comes down to, trying to understand the velocity of each token and how that relates to circulation overall. Just if you could dimensionalize that for us to help us better understand that relationship would be super helpful. Thank you.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Yeah, you're welcome. Thanks again. A couple of things of note. I think obviously, you're absolutely correct. The money stock, which today is sitting at around $55,600,000,000 of USDC versus the amount of transactional volume that happens on chain.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

That's, by the way, not including transactions that are happening on exchanges, is sort of off chain transaction volume, but the on chain transaction volume. What you note is that a dollar digital currency such as USDC has very high velocity. And I think in part that is based on the fact that blockchain based transactions now, through the development of mature blockchain networks, allow transactions to happen in fractions of a second and fractions of a cent. And so the speed with which transactions can happen, the ability to move the digital dollars all around the world seamlessly, to move them between different protocols for investment or for payments, it is a higher velocity form of money. And I think just like data moves a lot faster than your newspaper delivery or your video call moves a lot faster than a letter, internet native architectures for velocity money overall.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Now, in terms of the connection between that money velocity and core Stablecoin money supply, I think there's correlation. You can sort of see that correlation. But we've also seen that over the last year, transaction volume growth has been higher than the stablecoin money supply growth. And I think in part that reflects the improvements in blockchain technology infrastructure so that it is faster and cheaper and easier to move these digital dollars around. And that also I think reflects the growth in payment utility that we're seeing for these in emerging and developing markets and peer to peer transactions.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And so, think it's a mixture of things like that, that we look at. And I think from a very long term perspective, we certainly are interested kind of the monetary theory that will go behind this new internet financial system and money velocity and ultimately how we think about kind of macro aggregates in terms of impact on economic activity as a whole, but that's a ways off.

[Peter Christiansen, Director at Citi]

That's helpful. And then as my follow-up, I'm curious, CPM seems to be off to a great start here, a ton of new partnerships that you signed up, some marquee ones, in fact. Curious what's the next milestones for CPN as you're looking for that network to grow? And what is the interrelationship, I guess, between that you envision between CPN and ARC, in the future? Thank you.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Sure. It's a great question. So we're very happy with the initial launch of CPN. We we launched it, as you know, just very recently in what we consider to be the pilot phase. We've had a tremendous amount of demand from financial institutions that want to become members and want to participate on CPN.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Really, the first phase has been about getting a few key high priority corridors active on that. So we've been able to bring four corridors, Hong Kong, Brazil, Nigeria, Mexico on. And as we look at the priorities for ourselves between now and the end of the year, let's just say, we want to bring significantly more corridors on so that money flows can work seamlessly across major developed markets and more emerging and developing markets. And so that's a big focus and making sure that we can provide sufficient liquidity across those corridors so that people who want to move volume through this can. So really activation of corridors is key.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

There are a lot of product features that we are developing in response to what the market has told us they need. And so one of the things that we found is that the number of institutions that want to onboard and become integrated and activate on the network sort of outstrips our capacity to bring them on. And so, we're making self-service product dashboards, self-service tools for kind of configuring the way flows work for these institutions. And so that is key those key product investments and we hope to bring significant number of new members on. And obviously, ultimate ambition is that thousands of members will join CPN and participate in a wide array of payment flows.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

On the second follow-up question related to ARC, we do see ARK playing a very important role with CPN. ARK is designed to be a purpose built blockchain for stablecoin finance for payments, FX, and capital markets. And you will see in the light paper that was made available on our website just shortly ago that ARC itself will include a native FX engine and FX platform within it. ARC will include configurable privacy and and opt in confidential transfer transfers, very important features for money flows between financial institutions. And then obviously a straightforward kind of security and gas fee model.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

All of those are attractive for what we're building for ARC, and we certainly hope that many of the financial institutions that are implementing and integrating with ARC will use, our CPM, excuse me, will use ARC network as a as a key kind of backplane for, you know, their their payments and financial obligations.

[Peter Christiansen, Director at Citi]

Thank you. Congratulations again.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Thank you.

[Operator]

Your next question comes from the line of Ken Worthington with JPMorgan. Please go ahead.

[Ken Worthington, Financial Analyst at JP Morgan]

Hi, good morning and thank you for taking my question. I wanted to follow-up on payments. The payment opportunity seems to be developing quickly. You guys launched CPN and Coinbase announced Shopify and building on the Coinbase Commerce platform. To what extent are these networks sort of complementary versus competing?

[Ken Worthington, Financial Analyst at JP Morgan]

And ultimately, is it important for Circle to be the dominant payment network? Or is it better to be sort of one of many networks as long as they're sort of focused on in utilizing USDC?

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Thanks, Ken. It's a great question. There are a few pieces to this. So first and foremost, USDC as a stablecoin network is a market neutral infrastructure, which many, many different types of companies are building on top of, whether those are capital markets firms, trading firms, exchanges, brokerage platforms, neo banks, traditional banks, payment service providers. There's a huge array of companies, networks themselves like Visa, Mastercard increasing their use of stablecoins and USDC specifically as well.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

So we expect many different payment networks and many different capital markets exchanges and others to build on our stablecoin market infrastructure. We view that as very valuable in growing use cases, very valuable in growing distribution. It can be very valuable in growing the adoption of other technology, protocols and services that we also monetize. And so broadly, we've got a big tent mentality here and we want to see a lot of success across many different types of companies. Now, I think secondly, when a Shopify launches USDC payment acceptance and they're using a product from Coinbase to do that, that's great.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

That's exactly what we want to see from our partners like Coinbase and others. We want to see people building and integrating USDC into commerce flows and into other types of applications. And so as Shopify merchants can accept USDC, that grows the utility of the stablecoin network. That means that digital wallets that are in the hands of the hundreds of millions of Binance users or the 100,000,000 NewBank users or users who use different digital wallet products all around the world that support USDC, that they now have something that they can do with that and transact with that. So that grows network value for Circle and it expands the utility.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

That's part of our competitive moat, is this expanding utility to developers that integrate this and deploy this in different ways. I would also say, just as a kind of comment, just in general, we are seeing incredible demand and acceleration from firms in the payments industry, from firms that build infrastructure for supporting payments with a wide variety of companies. Just in recent weeks, we've announced partnerships with Fiserv, FIS, CorePay, Matera. And these are firms that provide core infrastructure, including payment infrastructure, to tens of thousands of banks and financial institutions, and they're integrating our technology. They're integrating USDC, and that's really tremendous and I think just represents that there are going be many, many different networks and many, many different distribution points for how this comes into payments.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Obviously, CPN is a very important initiative from us and we want that to be a very, very successful general purpose on chain payments network. We believe that the model we're putting forward with CPN is going to be very attractive to financial institutions and ultimately to the customers that they serve.

[Ken Worthington, Financial Analyst at JP Morgan]

Okay. Amazing. Thank you. And then the Circle IPO, obviously a huge success here. You now have a really valuable currency.

[Ken Worthington, Financial Analyst at JP Morgan]

What are your thoughts on leveraging the value in your stock to drive additional shareholder value, through various means? Is there an opportunity there?

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Yeah.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

I can comment on that. I think, first and foremost, virtually everything that we do has overwhelmingly been the result of organic product development. We are a technology company. We're a software driven technology company. And we like to build, we like to innovate.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

But we certainly, from time to time, find teams, find intellectual property, find complementary technology that we do want to add to the portfolio. And in fact, this morning alongside the announcement of ARK, we announced a small acquisition of both a team and intellectual property that is very important intellectual property in this next generation of stablecoin finance blockchains. So, that's an example where we have done that. And earlier this year, we acquired another firm that had a team and core intellectual property around privacy and confidentiality in blockchains. And so we do see opportunities to use our currency to do M and A.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

But we're careful and deliberate, I don't think our strategy here is to go try and do big complex acquisitions to kind of throw kind of additional business lines next to what we do. I think we take a kind of full stack integrated platform view of what we do. And so we only want to do things that really fit clearly in that kind of product mandate. We've got a lot of organic development happening now and we're excited to deliver on that.

[Ken Worthington, Financial Analyst at JP Morgan]

Great. Thank you so much.

[Operator]

Your next question comes from the line of Owen Lau with Oppenheimer. Please go ahead.

[Owen Lau, Executive Director at Oppenheimer & Co. Inc.]

Good morning and thank you for taking my question. So first of all, congrats on the quarter and congrats on the successful IPO. For my question, could you please talk about the adoption of USDC in remittance? I know you have some partnerships with remittance companies, but some other are thinking about creating their own stablecoin as well. How do you gauge the adoption here?

[Owen Lau, Executive Director at Oppenheimer & Co. Inc.]

Is there any way you can quantify for us the penetration for USB C so far? Thanks a lot.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Yes, it's a great question. We certainly have continued to see demand in remittance. And by the way, remittance that we observe is both kind of family member to family member or kind of individuals, but there's a lot of B2B remittance, meaning companies that may have overseas operations and need to remit capital back to say The United States or Asia or Europe and so which is more like a treasury flow. But those kinds of cross border flows we're seeing proliferate. We have more and more partnerships that are coming online in this use case.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We obviously in the quarter had several prominent cross border fintechs expanding what they're doing with USDC, Remitly, MoneyGram, ZEPS as well, all of whom have sizable franchises. And CPN itself, the primary use case on it is remittances, both consumer to consumer and B2B. And so, we're seeing that as the first major use case on Circle Payments network as well. I would also say there are indirect things that we look at. So, for example, kind of peer to peer flows in different markets around the world.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We kind of try and monitor those peer to peer flows through various websites that provide data on that. And we've grown our presence in those peer to peer flows fairly considerably over the last year. In terms of the general question of other stablecoins, I mean, I think the key thing to understand is that what makes a stablecoin network good for remittance is the liquidity of that stablecoin all around the world. And so what we've been able to do both through primary and secondary liquidity is create a tremendous liquidity network. And what does that mean?

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

That means that if I have USDC and I send it to a person in Brazil, it's fast and cheap to get that into a Brazilian bank account in real. And all around the world, there are these on and off ramp companies that support USDC. So, we've built the liquidity network which eases the way in which people can seamlessly move value and move value in and out of different currencies, e money systems, and banking systems. And so that liquidity network, which has been many, many years of work with regional banks, global banks, payment service providers, and others, is really something that is very, very difficult to replicate. So just having a coin doesn't actually really solve a problem in terms of the ultimate delivery of money and the settlement of money and the liquidity of that against all of these different parts of the global financial system.

[Owen Lau, Executive Director at Oppenheimer & Co. Inc.]

Got it. That's very helpful. And then as my follow-up, could you please add more color on your partnership with OKX, which is a very large exchange in Asia as well? What is the economic arrangement look like? And how does this deal different from other deals such as Binance and Coinbase? Thanks a lot.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Sure. So first thing I'd say is digital asset markets are a critical market for us. They continue to grow. They're very sizable. There are many companies, both regional companies and global companies that are critical there.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We have been growing our participation in those markets fairly materially. Our share of spot market volume on the major exchanges grew tenfold over the last since beginning of 2024. And so we're really focused on that. I think as kind of compliance and regulatory integration and having trustworthy, safe, stablecoins becomes more important, we're finding more opportunities to partner with the biggest exchanges. Now, Coinbase had a head start.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

They were the first big exchange to really bet on USDC and that's been great for them. Obviously, we established a partnership with Binance. We've expanded that partnership with Binance and they're the largest exchange in the world. And with OKX, getting back to your question, we're very excited about the expansion of our relationship with OKX. We don't disclose the material or commercial terms of the specific transaction.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

But what we've characterized is that they're adopting Circle Wallet technology we're offering them integration into our core Circle Mint infrastructure so that they can provide the institutions that are coming to their platform with the best possible liquidity experience with USDC. And so they have 60,000,000 users. This is gonna help promote USDC to those 60,000,000 users, growing again the value and reach of our network and the utility of USDC. And we hope to do a lot more with OKX as they also become a much more regulated player, regulated in Europe. They obviously have publicly talked about their launch in The United States.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And so it's a very solid firm with a global franchise and an important expansion of our strategy in digital asset markets.

[Owen Lau, Executive Director at Oppenheimer & Co. Inc.]

Thanks a lot.

[Operator]

Your next question comes from the line of John Todaro with Needham. Please go ahead.

[John Todaro, Senior Analyst at Needham & Company]

Hey, guys. Thanks for taking my question and congrats on a great quarter and the rollout of ARC. First question related to ARC, You know, how distributed is the goal for ARC from kind of a node operator, validator standpoint? How do you ensure gas fees remain low? And then I have a follow-up question.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Sure. Absolutely. A couple of things. One is I would highly encourage you to read the light paper which was made available this morning. And we talk a little bit about some of these issues there.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

So there is a novel fee mechanism that we have designed for ARC, which will ensure predictable low costs for transactions and obviously those transactions priced in USDC. I believe there'll be subsequently significantly more information about the fee market mechanics as we go into kind of public test net. But there's a novel approach that we're taking there. It's very important if you're a financial institution or a commerce firm that you have low and predictable fees and fees that you can pay in real digital cash. And so that's very important.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And then in terms of distribution, I think we ultimately aspire that ARC is operated by a fairly large distributed network of professional validators. We are very focused on vetted professional validators that can meet the operational security and compliance expectations for people running this critical infrastructure. We want that to be highly geographically distributed. We want that to be distributed across major institutions as well. And so, I think we ultimately believe that this is a tremendous opportunity for financial market utilities, for financial institutions, for large existing major firms in validator infrastructure.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And so we have a whole vision go to market that we're thinking about there. And again, we're in the early stages of standing this up, but that I think the light paper touches on this issue as well in terms of how we're thinking about that evolution.

[John Todaro, Senior Analyst at Needham & Company]

Great. Thanks for that Jeremy. And then just as it relates to Genius, so if you look into some of the Tether circulating supply growth seems to have kind of done this leveling off since July 27. USDC has continued to have growth since then. When you talked earlier about seeing some of that momentum or effects from Genius Act, was that sort of what you're hinting at?

[John Todaro, Senior Analyst at Needham & Company]

Do you think that's a result of Genius? Or we're not really seeing the effects yet from that standpoint?

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Yeah. I mean, it's hard to specifically correlate the kind of the rapid acceleration in USTC growth over the past month and a half or so with a specific legislative outcome. I think one could broadly say awareness of USDC is growing around the world, awareness of USDC as a product that is sort of purpose built for what the Genius Act represents is interesting and whether that's affecting user preference, it's very, very hard to know. But my comment, I think that you're referring to is much more around commercial engagement. Since the Circle IPO and since the final passage of Genius Act into law, we have seen just an incredible amount of inbound interest from financial institutions across every sector of the financial industry, from major technology companies, from large enterprises, and we're seeing that interest coming into us from all around the world in all the geographies that we're in.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And so I think this has been a catalytic moment for mainstream institutions to say, Okay, now I can play. Now I can build. Now I can work with this technology. There's obviously also been regulatory relief in The United States for financial institutions to engage in the space, and that's obviously been additive as well. And so we're just seeing the kind of commercial opportunity set that's coming in for us right now growing considerably, which is really exciting.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And I think that this is very much something that we talked about while we were going through our IPO and engaging with the market, which is that we believed that Genius Act would be an important catalytic moment and a tailwind to adoption of what we're doing. And now we've got to kind of grab those opportunities and make sure we're building the right products and services for these partners and critically make sure we can put together win win economic relationships where these customers can deliver value for their customers, they can grow economically, we can grow economically, and that's very much our fundamental philosophy as we partner with firms around the world.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Just add on to that. Genius has clearly been a major catalytic event from that interest from major financial institutions across every segment of financial activity. I'd make one sort of cautionary note though, while absolutely necessary for this accelerating growth in USDC and in the Internet financial system, financial services companies, particularly the largest ones integrating with new technologies and rolling that out to their customers typically takes time. And what's tremendous about where we sit is they're exploring deep integrations with us, which leads to stickiness over time. But at the same time, the speed of their rollout will be dependent upon them and their own abilities internally to make progress. That's exactly right.

[John Todaro, Senior Analyst at Needham & Company]

Yes. Great. Thank you for taking my question and congrats again.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Thank you.

[Operator]

Your next question comes from the line of Jeff Cantwell with Seaport Research. Please go ahead.

[Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners]

Hey, thanks. First of all, congrats on the IPO. Also on the past year, Jeremy was being signed. I was thinking that for you and many others involved in the crypto industry. It probably was a long journey getting to that point.

[Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners]

So I want to say congrats to you and to everybody who helped make that happen. Can you maybe talk about what you've seen? I just want to follow-up on the previous question. Post the Genus Act's passing, it looks like your USDC in circulation was $61,000,000,000 in Q2 and now in August it's $65,000,000,000 So it does sound like you're seeing increasing demand. And I was hoping you can maybe give us a little color as to what you're seeing since the Genus Act was passed just a few weeks ago.

[Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners]

Is it more domestic or international growth? Can you just talk more about that? And then also wanted to ask, how are you thinking about the growth in USDC from here? You're talking about a 40% CAGR. So how would you describe where you expect to see that growth come from?

[Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners]

Will you mind just bucketing what are the incremental opportunities for USDC as you think ahead? That'd be great. Thanks.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Sure. I'll take part of that and I'll have Jeremy Foxken take part of that as well. So, I mean, the post Genius demand, again, as we just talked about, I'm mostly characterizing that around institutional interest in building on our stablecoin network, institutional interest in working with Circle, which as Jeremy Fox Gein just noted, these institutions and putting together relationships, implementing product, getting those products out and scaling will take time. I think the more recent growth as I see it reflects a kind of green light go view within the global environment to utilize stablecoins. That is certainly been fostered by the increasing activity in digital asset markets.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

But I think it's broadly a kind of a signal to the market that this is now a form of digital cash like instrument that can be utilized. And so, it's going to be interesting to see and I know that ties into your other question about growth. Obviously, with recent acceleration, we've grown 90% year over year and 49% year to date. But in terms of how to think about that going forward, I know Jeremy Foxkene, you have some thoughts on that and just our general philosophy around how to think about that because it is not a straightforward thing to guide on hence the approach that we take.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Thank you, Jeremy. I'll talk a bit about how we view you referenced the 40% number we put out, how we view that. As I said in my remarks, right, the growth in USDC in circulation in many ways is the output over an entire economy. The digital asset markets with a bootstrap use case for stablecoins and represent the largest part of that economy today. But as I think we've been talking about on this call, we are seeing accelerating interest and growing adoption from every major financial services vertical for whom these new money technologies can bring tremendous advantages.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

This is very early days. We are right at the beginning of building the internet financial system. And there's a multi year, if not multi decade growth for these new technologies within financial services. Specifically as to guidance, there is a growing number of third party research firms, financial industry analysts who are publishing research on stablecoin growth. And they all see not just the promise that I touched on, but multi year CAGRs and those growth rates range from kind of 25% CAGR at the low end up to 90% plus CAGR at the high end with from our reading the best current median at around a 60% CAGR.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

We believe in the benefits of these new technologies very, very strongly. When it comes to guidance, our core model and we run a range of scenarios to enable us to manage the business in an uncertain environment. But our core model suggests a 40% CAGR. And if we can deliver that in terms of USDC growth, we believe that will deliver a compelling financial return for our investors.

[Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners]

Got it. Okay, great. And maybe as a follow-up, one of the frequent questions we've been asked for clarification on about your company post the IPO is, Where is the on chain transaction volume coming from? Can you walk through that in more detail? You just reported $5,900,000,000,000 in on chain.

[Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners]

So maybe can you discuss the use cases, maybe even geographically where the transactions are coming from? I think a lot of the interest is because public investors are still trying to get a better feel for the world of crypto whereas the world of fiat is still as much more familiar for the obvious reason here in The U. S. So maybe can you talk to us about where the $5,900,000,000,000 is being generated? That would be very helpful. Thanks.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

I can touch on that. And I think as you know public blockchain data does not include geographic IP addresses or things like that. But there are very good heuristics to look at this. In fact, I think there's some excellent third party research firms that do focused research on blockchain data, blockchain analytics. And we look at that and look at other data sources.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

What I can certainly say is, it's highly distributed geographically. There's an enormous amount of traffic in USDC that is around the world, Europe, Asia, emerging and developing markets, Latin America, Middle East, Africa, Southeast Asia. So it is very geographically distributed. And while The U. S.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Is important, it is not the majority. And so we see that geographic distribution in the data that we're able to look at. And obviously, we can identify activity that is specifically USDC that's moving between exchanges or super wallets and things like that. And oftentimes we'll correlate that to investing activity, savings activity, but also for payments activity. We know for example that peer to peer payments in emerging developing markets using stablecoins are a significant use case.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

But most of those peer to peer payments are intermediated by the big wallets that are attached to these big, what I think of as financial super apps, the Coinbase products or the Binance products, where people in those markets are using them not just for trading and investing, they're using them for savings, to earn yields, and for P2P payments as well. And so once the USDC gets into one of those big platforms, we can't track inside of there exactly all the flows and what people are doing. But those are some comments that I can give. I don't know if you want to add anything, Jeremy.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Yes. I'd add on a little onto that just to give kind of a top down conceptual understanding of what this even means, right? In today's world, every money movement use case, so think kind of consumer payments through credit card networks, remittances, international kind of money transfers via swift. Every single use case effectively has a different technology delivery stack. With the internet, we are seeing the emergence of the first ever general purpose architecture for money movement.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

And so on chain transactions include money movement across all financial services use cases, which is almost a radical difference, certainly a tremendous difference to the existing system. So what does that mean? When we think about those use cases, just as examples, Visa moves somewhat north of $10,000,000,000,000 a year through its consumer to business and business to business rails. And that's one number that's off cited. But let's not forget, JPMorgan as an example moves somewhat north of $10,000,000,000,000 a day in gross money movement and gross money settlement as well as other use cases.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

And so all of that is intermingled in on chain transactions for stablecoins. And so it's as Jeremy said, it's difficult to disaggregate all of those different money uses, but we should not forget that all of those money use cases are represented in these numbers.

[Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners]

Perfect. Great. Thanks again.

[Operator]

Next question comes from the line of James Yarrow with Goldman Sachs. Please go ahead.

[James Yaro, VP - Equity Research at Goldman Sachs]

Good morning and thanks for taking the question. I just wanted to ask firstly on the outlook for non dollar stablecoins and the necessity for growth of these in your view to facilitate stablecoin cross border payments and thus CPN? And then perhaps just how you can, I guess, to what degree you plan to facilitate that with EURC?

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Thanks, James. It's a good question. So over the long run, we are very optimistic that virtually every major country in the world will have a good stablecoin policy regime and that we'll see proliferation in high quality regulated payment stablecoins. We believe Genius Act is actually driving that and we're seeing that with legislators and governments around the world who are now really racing to get their stablecoin policies in place. And so we do expect that proliferation.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We want to work with these non dollar stablecoins. We obviously issue EURC and that has done well. But we want to work with these non dollar stablecoins because on chain money is more effective and efficient money. It's programmable money. From a cross border perspective, if you can have a 20 fourseven, three sixty five continuously settled, atomically swappable PVP exchange, that's a very powerful building block.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And it's one of the reasons why we are building such an engine into our own core blockchain network arc is that we want to see that mature because we think that as a, again, a programmable building block for commerce, trade and various types of capital markets activity, that's going to be really important. Now, short of that all maturing, and we do believe it will mature, it is not necessarily an impediment to growing use of stablecoins in cross border settlement. And CPN itself really, from the start, the kind of FX model is designed to connect stablecoins to local currency liquidity and local electronic money rails. And so a person sending money from Portugal to a person in Brazil, they might have EURC or USDC sitting on one side of that transaction. And on the other side, there are essentially takers of that, what we call our BFIs, who have liquidity of USDC against local Brazilian real.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And they can effectively price against existing kind of prices in the market or they're competing on price. And then they can effectively use the immediate credit of the USDC to then initiate that near real time payment on the ultimate bank transferred money. And so, there are ways to do that. And there are also ways to have the on chain FX market basically be an on chain FX market where the market and the pricing is all completed but where the fulfillment on the currency side is kind of post trade. And so that's also a structure that we expect to see develop more as well.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

But again, long term, we're very much encouraging of and want to see more and more what we call, the local partner stablecoins. We wanna see them issue on the ARK blockchain. We wanna support them on CPN. We wanna support them in in Circle Mint and in our wallets. And we wanna we wanna be very multi stablecoin in what we do, and we believe that's part of building the Internet financial system.

[James Yaro, VP - Equity Research at Goldman Sachs]

Very clear. On another topic, maybe you could just talk a little bit about the opportunity for Circle Gateway and then perhaps how this, I guess, differs or integrates with Circle CCTP?

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Yeah. Absolutely. So, Circle Gateway and Circle, Circle CCTP, solve similar but somewhat different problems. So CCTP is protocol at a kind of low level. It's a low level protocol that allows for cross chain settlement of USDC across a multitude of different blockchains.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

It's used quite significantly in cross chain USDC today. The last time I looked, I think it was well over 80% of cross chain USDC was running through CCTP. And we have a version two of that, which has continued to grow as well. So that allowed that's kind of a more lower level in a sense. It doesn't solve kind of what what we think of as, like, the user experience problem.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

In in the in the world of CCPP, you know, what we find is that there are a lot of wallets, whether it's an institutional wallet or a consumer wallet, where you still end up in a world where you need to kinda know, like, which chains do I have USDC on, and which chains, you know, do I wanna get the USDC to. And so the UX is is a is a hurdle. And so Circle Gateway is really designed as an abstraction to, eliminate that user experience hurdle. So a user, again, this could be an institution or or or an individual, just sees a a USDC balance. So they say, I have 10,000 USDC, and they can essentially spend that balance, in less than a second, to any of the supported chains.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

And so you can kinda just say, hey, I have USDC. What kind of wallet do you have? Or give me a QR code or or give me an address, and it can spend seamlessly to those. So it really simplifies the UX. This is part of our goal of just kind of having the crypto disappear into the background and make this a more streamlined experience.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

So Circle Gateway is a different architecture to accomplish that, and it's something that we're really primarily bringing to market through developers who are going to integrate this into their products and services. And like CCTV version two, it also does include new opportunities for monetization for Circle. And so, user experience is a feature. We want to monetize that and also just make these products better for people who are using them.

[James Yaro, VP - Equity Research at Goldman Sachs]

That's very clear. Thanks a lot.

[Operator]

Next comes from the line of Brian Bendel with Deutsche Bank. Please go ahead.

[Brian Bedell, Director at Deutsche Bank Securities]

Great, great. Thanks. Good morning. Thanks for taking my question and also congrats on the very successful IPO. Maybe a big picture question on growing USDC over time within the industry and the desire to make this a winner take most and increase the scale and network effects of the USDC.

[Brian Bedell, Director at Deutsche Bank Securities]

I mean, I guess, Jeremy, what's your appetite for partnering with more institutions? And if that means higher distribution costs and lower reserve margins, is that something that you find appealing to grow USDC? Or do you really think about the reserve margin as something you want to keep in that mid-30s range at least?

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

Yes. I can take part of that and maybe Jeremy Soxdin can take the other part of it. So first of all, we have a very strong appetite for growing the partnerships, you know, that that are gonna grow our network. And I I would say it it's helpful to kinda remind folks that, you know, we have many, many different types of partnerships. A partnership with a digital wallet is completely different than a partnership with a merchant acquirer, which is completely different than a partnership with a a large exchange that has hundreds of millions of users.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

So there there are many, many different types of partners that we work with. And each one of those partnerships, you know, has a has a unique, you know, deal deal format to it. So we have we have a lot of different deal playbooks that we execute. And I think, it's it's sort of simplistic to think that every deal has to do with giving away reserve income. That is not the case.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

We focus on partnerships where each party is a, focused on delivering value for their customers. So how are they going to grow value for their customers through this partnership? And b, that it's a win win growth oriented model. So we wanna build economic relationships that incentivize growth so that we're seeing that the partnership is actually having an impact on whether it be transaction velocity or market share shift or USDC growth itself. So we really focus on these win win growth oriented relationships.

[Jeremy Allaire, Chairman, CEO & Co-Founder at Circle Internet Group]

It's not a carte blanche, here's a rate card, go do this kind of thing. We wanna build. We wanna build with people who wanna build and grow with us, and that's our filter for this. And I think that that is working. I think Jeremy maybe can comment more on just sort of how we think about that vis a vis RLDC margin and the outlook there.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

Thank you, Jeremy. I'll build on that and then get to the numbers piece of it. But it's important to understand that the strength and breadth of our platform capabilities combined with our position as market neutral infrastructure, encourages more players and enables even fierce competitors, right, to build on and integrate with our platform. And so our partners then bring the benefits of these new money technologies to their customers, benefiting their customers, building their business and growing USDC usage and adoption, which strengthens our network with more capabilities, more users, more distribution. And this is a network business with network effect and our position strengthens as the network strengthens.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

And that's important context for our future outlook on our LDC margin. We're not guiding beyond 2025 at this time. However, I think of three factors that provide relative strength tailwinds, if you like, relative strength to this margin over time. The first would be the growing strength from network effects, which is what I was just talking about. And we see that in our commercial discussions.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

And we also know that and this is important to remember growth in USDC held within partner infrastructure and which may be subject to incentives also leads to growth in USDC in the ecosystem more broadly held outside of partner infrastructure. So we see growing strength from network effects. That's the first point. The second, we see growth in USDC held within Circle's platform infrastructure. We have a broad based feature rich platform as I just mentioned and our position as market neutral infrastructure only enables more people to build upon our platform over time.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

And that's important. And we have greater economic flexibility with USDC held within our platform infrastructure. And then finally, we have growth in our high margin other revenues, right? Predominantly today, we make money from the stock of money on the network. Over time and through products we've already launched and started talking about even as they're nascent today, we will be monetizing certain of the flows across that network infrastructure where we are able to add value added services to the benefit of the users.

[Jeremy Fox-Geen, CFO at Circle Internet Group]

And so we see this growth in other revenues over time and those are very high margin revenues and provide strength to our overall margin over time. So those three things combined we think provide longer term relative strength to our RLDC margin.

[Operator]

That concludes our question and answer session. I will now turn the call back over to John Andrews for closing remarks.

[John Andrews, Head - Capital Markets & IR at Circle Internet Group]

Great, Tiffany. Thank you. And apologies for the couple of people who got stuck in the queue, but we are up against a hard time end here. We are happy to follow-up with everybody. You know how to reach us through the investors' website at circle.com, and enjoy the rest of the day.

[Operator]

Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect.

Participants

Executives

• John Andrews, Head - Capital Markets & IR
• Jeremy Allaire, Chairman, CEO & Co-Founder
• Jeremy Fox-Geen, CFO

Analysts

• Joseph Vafi, MD - Equity Research at Canaccord Genuity - Global Capital Markets
• Peter Christiansen, Director at Citi
• Ken Worthington, Financial Analyst at JP Morgan
• Owen Lau, Executive Director at Oppenheimer & Co. Inc.
• John Todaro, Senior Analyst at Needham & Company
• Jeff Cantwell, Senior Equity Analyst - Fintech at Seaport Research Partners
• James Yaro, VP - Equity Research at Goldman Sachs
• Brian Bedell, Director at Deutsche Bank Securities