Coinbase News: Coinbase and Circle’s Financial Arrangement Unveiled in S-1 Filing

A recent S-1 filing by Circle with the U.S. Securities and Exchange Commission has revealed an intriguing financial arrangement between two major players in the stablecoin market, Coinbase and Circle. Here’s a closer look at the details and implications of this partnership.

Coinbase Receives 50% of Circle’s USDC Reserve Revenue

Coinbase Global is entitled to half of the residual revenue generated from reserves backing Circle’s USDC stablecoin, according to new disclosures in Circle’s S-1 filing with the U.S. Securities and Exchange Commission. The filing, submitted Tuesday, offers a rare glimpse into the financial arrangement between two of the biggest players in the stablecoin market. Circle confirmed that Coinbase receives 50% of what it calls the “residual payment base”—a portion of revenue derived from the reserve assets supporting USDC, a stablecoin pegged to the U.S. dollar. Circle’s reserves are made up of highly liquid assets, including U.S. Treasuries and cash equivalents.

Rep. French Hill Rejects Stablecoin Interest Proposal

Republican Representative French Hill has rejected Coinbase CEO Brian Armstrong’s call for allowing users to earn yield on digital assets like USDC. During an April 1 briefing, Hill emphasized that lawmakers have not reached a consensus on the matter, stating, “I hear the point of view but I don’t think that there’s consensus among the parties or the houses on having a dollar-backed payment stablecoin pay interest to the holder of that stablecoin.”