The recent IPO filing by Circle has shed light on the revenue-sharing agreement between Coinbase and Circle, revealing an intriguing symbiotic relationship between the two companies. Coinbase receives 50% of Circle’s residual revenue generated from reserves backing its USDC stablecoin, highlighting their mutual dependence and global influence in the cryptocurrency market.

Circle's revenue and reserve income of $1.7 billion in 2024 with a net income of $156 million demonstrate the significant financial impact of their partnership with Coinbase. The correlation between Coinbase’s share of Circle’s reserve income and the amount of USDC held on their exchange reflects the growing influence Coinbase has on Circle’s revenue streams.

While the revenue-sharing agreement has benefited both companies, it also poses potential risks for Circle as they rely heavily on Coinbase's business strategies and policies. To mitigate this dependency and compete with major stablecoin rival Tether, Circle has been focusing on expanding international adoption of USDC through strategic partnerships with digital finance companies worldwide.

Circle's plans to list on the New York Stock Exchange as "CRCL" signal a new phase of growth and development for the company, showcasing their ambition to solidify their position in the global cryptocurrency market. The expansion of USDC adoption through partnerships with companies like Grab, Nubank, and Mercado Libre demonstrates Circle's commitment to driving the widespread use of their stablecoin.

Overall, the revenue-sharing deal between Coinbase and Circle underscores the interconnected nature of the cryptocurrency industry and the strategic collaboration necessary for companies to succeed in this competitive landscape.