Circle's third-quarter revenue rises 17% as ARC token sale offsets lower reserve income

Circle Internet Group (NYSE: CRCL), the issuer of the USDC stablecoin, said on Nov. 4 that its third-quarter total revenue and reserve income rose 17% from a year earlier to $865 million. Reserve income fell as yields declined, but $182 million from the presale of ARC, the network token for its Arc blockchain, made up the gap. In a filing with the U.S. Securities and Exchange Commission the same day, Circle also disclosed that it had cut about 5% of its workforce.

Token sale offsets shrinking interest income

Most of Circle's income comes from interest earned on USDC reserves, the dollars backing the stablecoin, which are held largely in U.S. Treasuries and similar assets. Reserve income was $658 million in the third quarter, down 8% from a year earlier, as the reserve return rate fell 61 basis points to 3.5%. An 8% rise in average USDC in circulation partly offset the decline.

Other revenue filled the gap. It jumped 627% to $207 million, of which $182 million came from the ARC token presale. Circle opened Arc's public mainnet on Sept. 16 and completed a genesis mint of the full initial supply of 10 billion ARC tokens. The company said ARC is designed to serve as the coordination mechanism for security, utility and governance on Arc, which is working toward a transition to proof of stake in 2027.

Distribution, transaction and other costs, which include payments to partners that distribute USDC, fell 8% to $412 million. As a result, revenue less distribution costs (RLDC) rose 55% to $453 million, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) jumped 85%. Operating expenses rose 16% to $245 million.

USDC supply flat at $73.9 billion

USDC in circulation stood at $73.9 billion at the end of September, unchanged from a year earlier. Average circulation for the quarter was $73.3 billion, below the second-quarter average of $76.5 billion. USDC issuance and redemptions each totaled $104 billion during the quarter. USDC's share of the U.S. dollar fiat-backed stablecoin market was 27%, down 183 basis points year over year.

Usage metrics grew. Onchain USDC transaction volume rose 49% to $13.9 trillion, and the number of wallets holding more than $10 of USDC rose 16% to 7.3 million. Transaction volume was still lower than the $14.8 trillion recorded in the second quarter.

Circle cuts workforce by 5%, keeps full-year guidance

In a footnote to its results, Circle said it carried out a workforce reduction of approximately 5% designed to better align its organizational structure with its operating model and strategic priorities. Restructuring expenses were about $9.1 million, mostly notice-period and severance payments.

Circle left its full-year guidance unchanged: 2026 other revenue of $310 million to $330 million, adjusted operating expenses of $570 million to $585 million, and a multi-year target of 40% compound annual growth in USDC circulation. The other revenue target was raised to its current range from $150 million to $170 million with second-quarter results in August, reflecting the ARC token presale.

On the business side, Circle signed a definitive agreement to acquire Tazapay, a Singapore-based B2B cross-border payments platform. The deal is expected to close in 2027, pending regulatory approvals. Circle also highlighted Binance's $100 million equity investment and renewed USDC partnership, as well as a Samsung Wallet feature that lets eligible U.S. users send money abroad using USDC.

"In Q3, we saw continued proof that institutions are building and expanding on USDC."

Jeremy Allaire, Co-Founder, CEO and Chairman, Circle

On Upbit, USDC trades at 1/58th of Tether's volume

USDC is listed on the Korean won markets of both South Korean exchanges Upbit and Bithumb. As of 8:30 a.m. KST on Nov. 5, it traded at 1,348 won on Upbit and 1,347 won on Bithumb, about 0.3% above the dollar-won exchange rate of roughly 1,343.9 won at the time.

On Upbit, USDC trading lags far behind Tether (USDT). At the same time, 24-hour trading value on Upbit was about 1.11 billion won for USDC and about 63.94 billion won for USDT, roughly 58 times more.