Analysts at the investment bank JPMorgan have announced a downgrade in their future profit forecasts for both Circle and Coinbase. The primary driver behind this revised outlook is a new revenue-sharing agreement established between these companies and the perpetual decentralized exchange, Hyperliquid. Under the updated terms, the American exchange Coinbase now classifies the USDC stablecoin on this platform as an "on-platform" asset, allowing it to earn yield from the interest rates on these reserve funds. However, the critical shift is that Coinbase now transfers ninety percent of this generated revenue directly to Hyperliquid. As JPMorgan specialists note, Coinbase and Circle previously split this income almost equally, making the previous financial model significantly more predictable and favorable for the stablecoin issuer.

JPMorgan experts have characterized the current situation as a classic "prisoner's dilemma" for Circle and Coinbase. In their view, this alteration in partnership terms creates a structural vulnerability that could force the companies into hidden competition over the optimal allocation of USDC volumes, ultimately acting to each other's detriment. Analysts also cited the broader weakening of the cryptocurrency market as an additional macroeconomic headwind. Since March of this year, the circulating supply of Circle's stablecoin has shrunk from eighty billion to seventy-three billion dollars. Furthermore, the total market capitalization of the entire "stablecoin" sector has decreased by ten billion dollars since May. Nevertheless, JPMorgan emphasized that, in the long term, the persistence of high interest rates could partially offset these losses and sustain the revenue generated from USDC reserves.

Despite these short-term challenges, Circle is actively diversifying its target markets by placing a strong strategic bet on the Asia-Pacific region. On July 14, the company signed a memorandum of understanding with JCB, Japan's largest payment system. The partners intend to explore the use of USDC for cross-border payments, domestic settlements, and merchant payments by Japanese vendors, which is particularly relevant for foreign tourists who frequently encounter limits on their traditional bank cards. The initial phase will be a pilot program for domestic fund transfers within the JCB network, which serves approximately 140 million cardholders and over 40 million merchant locations globally. Additionally, in late June, Circle announced plans to collaborate with the Japanese financial corporation Nomura to launch a USDC-based foreign exchange settlement service for local companies in the year 2027.

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The material is prepared solely for informational purposes and does not constitute a financial advice or recommendation.