Binance Takes 22% Stake in Circle as USDC Deal Renewed for Five Years

Circle and Binance have extended their USDC distribution deal for five years. The new agreement, announced on September 22, sees Binance taking a $100 million equity stake in Circle alongside the contract renewal.

The deal changes two things for USDC holders: Binance now holds 22% of the stablecoins on its platform in USDC, up from 5% a year earlier; and Circle's cost of getting there is the highest it has been in the company's short public life. However, what the renewal costs, in fees or minimum balances, is not disclosed.

The size of Binance's stake is roughly 0.5%, smaller than Coinbase's historical position in Circle but still significant. The commercial agreement runs through September 2031 and replaces a November 2024 deal and an August 2025 expansion.

Circle generated about $668 million of reserve income, the yield it earns on cash and short-dated Treasuries backing USDC, in the second quarter. However, distribution costs already absorb 61% of this income, with Binance-related distribution costs increasing by $152.1 million in 2025.

Clear Street analysts ran the math on what each new dollar of USDC on Binance actually earns Circle and estimate that if Binance continues to receive a high-double-digit share, as in earlier terms, Circle retains only about $4 million to $7 million from an extra billion dollars of USDC. The rest goes to the exchange.