JPMorgan Reports Coinbase Gains Substantial Revenue from Circle Partnership and USDC Ecosystem
Coinbase (COIN) is benefiting significantly from its strategic alliance with Circle (CRCL) and its involvement in the USDC stablecoin ecosystem, driving both equity value and strong revenue streams, according to a recent analysis by JPMorgan.
The bank estimates that the total value of Circle-related economics to Coinbase shareholders ranges between $55 billion and $60 billion, indicating the market might be undervaluing the importance of USDC to Coinbase’s business model.
Coinbase holds about 8.5 million shares of Circle, valued at approximately $1.6 billion as of July 25. However, the more impactful source of income stems from USDC-related operations.
During the first quarter of 2025, Coinbase received close to $300 million in distribution payments from Circle, exceeding Circle’s total net revenue of $230 million for that period.
At the end of Q1, Coinbase had $13 billion in USDC balances on its platform, which generated $125 million in revenue with profit margins estimated between 20% and 25%.
Outside of its platform, Coinbase also shares half of the income from Circle’s Reserve Fund, earning $170 million last quarter at nearly 100% margin.
Despite these robust revenue figures, JPMorgan maintains a neutral stance on Coinbase stock with a price target of $404. The shares traded around $381 in early Tuesday sessions.
