Company: CRCL
Filing Date: 2025-06-02
Form Type: S-1/A
Source: 0001193125-25-132755
Chunk: 377

Company: Circle Internet Group, Inc.
Filing Date: 2025-06-02
Form: S-1/A
Chunk 377
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 the amount of USDC distributed by each respective party and
(ii) the amount of USDC held on each respective party’s platform (e.g., held in its customers’ accounts) in relation to the total amount of USDC in circulation. Subsequent to August 2023, the Company makes payments based on the amount
of USDC held on each respective party’s platform. In the case of a certain distribution arrangement, the Company also makes payments based on the amount of USDC in circulation held outside of each respective party’s platform. The Company
accounts for these agreements as executory contracts and accrues amounts payable as reserve income is earned and the amounts to be allocated are determinable. One-time payments are expensed as incurred. The costs associated with these arrangements
are recognized in Distribution and transaction costs in the Consolidated Statements of Operations.

Marketing Expenses

The Company expenses the cost of producing advertisements at the time production occurs and expenses the cost of communicating advertisements in the period during which
the advertising space or airtime is used as sales and marketing expense. Online advertising expenses are recognized based on the terms of the individual agreements, which are generally over the greater of the ratio of the number of impressions
delivered over the total number of contracted impressions, on a pay-per-click basis, or on a straight-line basis over the term of the contract. The Company expenses the
costs of marketing with various partners in the digital asset ecosystem over the term of the individual agreement. Marketing expenses are expensed as incurred and presented as a component of Operating Expenses in the Consolidated Statements of
Operations.

General and Administrative Expenses

General and
administrative expenses include costs incurred to support the Company’s business, including professional services fees paid for legal, accounting and consulting services, rent, employee meals and entertainment, travel expenses, bad debt and
credit losses, insurance, training and education, compliance, and other administrative services. General and administrative costs are expensed as incurred and presented as a component of Operating Expenses in the Consolidated Statements of
Operations.

Income Taxes

Deferred tax assets and liabilities are
recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income
in the period of the enactment date. Valuation