Company: CRCL
Filing Date: 2025-08-12
Form Type: S-1
Source: 0001193125-25-178989
Chunk: 130

Company: Circle Internet Group, Inc.
Filing Date: 2025-08-12
Form: S-1
Chunk 130
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%, respectively.

For the year ended December 31, 2024, 2023, and 2022, the daily weighted-average percentage of USDC in circulation held on Circle’s platform was approximately 2%, 2%, and 2%, respectively; based on information provided to us by Coinbase, the daily weighted-average percentage of USDC in circulation held on Coinbase’s platform was approximately 18%, 8%, and 3%, respectively; and the daily weighted-average percentage of USDC in circulation held outside Circle’s and Coinbase’s platforms was approximately 80%, 90%, and 95%, respectively. For the six months ended June 30, 2025 and 2024, the daily weighted-average percentage of USDC in circulation held on Circle’s platform was approximately 7% and 2%, respectively; based on information provided to us by Coinbase, the daily weighted-average percentage of USDC in circulation held on Coinbase’s platform was approximately 23% and 16%, respectively; and the daily weighted-average percentage of USDC in circulation held outside Circle’s and Coinbase’s platforms was approximately 70% and 82%, respectively.

During the periods presented, there has been an increasing proportion of USDC being held on Coinbase’s platform, which in turn has increased our payments to Coinbase under the Collaboration Agreement and thus our distribution costs. We are unable to predict whether the proportion of USDC held on Coinbase’s platform will continue to increase in future periods, as such proportion depends on factors beyond our control, including Coinbase’s actions. However, if the proportion of USDC held on Coinbase’s platform continues to increase in future periods, the growth in our distribution costs may exceed the growth of our reserve income, such that distribution costs as a percentage of reserve income increases in future periods.

In addition, we and Coinbase may agree to pay a portion of the residual payment base to approved participants to incentivize the circulation of stablecoins, which may impact our distribution costs. We have added and expect to continue to add additional distributors in the future and anticipate that such distribution contracts may have different commercial terms depending on negotiations with our distributors and the circumstances in our evolving industry.

#### Government regulation
At Circle, we have always had a “regulation first” philosophy that underlies our operations and has led to significant investments in building a robust compliance infrastructure. However, the laws and regulations to which we are subject are rapidly evolving and increasing in scope. As a result, we monitor regulatory changes closely and we expect to continue to invest significant resources in our legal