Competition Between Coinbase and Ripple Emerges over Stablecoin Issuer Circle, According to a Recent Report
In the dynamic world of digital assets, the potential acquisition of Circle, the issuer of the USDC stablecoin, by Coinbase has been a topic of much speculation. While no definitive talks or agreements have been reported as of August 2025, the close partnership and Coinbase’s significant equity stake in Circle have been driving substantial financial benefits and strategic integration.
Coinbase's interest in acquiring Circle, valued at $5 billion, could significantly impact the stablecoin market. In Q1 2025, Coinbase generated approximately $300 million in revenue related to its Circle partnership and USDC stablecoin, surpassing Circle’s own net revenue of $230 million for the same period. This revenue comes from distribution payments and reserve fund income tied to USDC holdings, with Coinbase holding $13 billion in USDC balances on its platform, contributing high-margin revenue streams.
JPMorgan analysts estimate that the economic value related to Circle and USDC could add as much as $60 billion to Coinbase's valuation given Coinbase’s central role in the USDC ecosystem and its 8.5 million shares in Circle valued around $1.6 billion as of July 2025. The strategic integration of USDC, which has a market capitalization around $63 billion and is the second-largest stablecoin after Tether, underpins this growing influence.
If the acquisition were to take place, Coinbase would further consolidate its dominant role in stablecoins and stablecoin-related revenue streams, potentially increasing its influence over digital dollar liquidity and payments. This is supported by Coinbase’s large USDC balances, integration with payment systems like Samsung Pay, and expansion into derivatives trading after acquiring Deribit for $2.9 billion earlier in 2025.
Meanwhile, Ripple, the company behind the XRP cryptocurrency, faces financial constraints that could be exacerbated by large acquisitions. Despite a previous $4-$5 billion bid for Circle, which was rejected, Ripple is partnering with Societe Generale FORGE and StraitsX to issue FX stablecoins on the XRP Ledger.
Circle, for its part, has been pursuing its IPO, publishing its prospectus to list its stock on April 1. The company's response to Fortune regarding the acquisition rumours confirmed this, stating that it was indeed pursuing its IPO.
The outcome of Circle's decision to remain independent or merge with either Coinbase or Ripple will impact the stablecoin market significantly. The developments underscore Coinbase’s expanding footprint in stablecoins, with potential implications for crypto market infrastructure and digital finance evolution if the relationship deepens further.
- The analysis of potential acquisitions within the digital asset sector suggests that Coinbase's interest in acquiring Circle, a significant player in the stablecoin market, could lead to substantial financial benefits and strategic integration, given Coinbase's central role in the USDC ecosystem.
- JPMorgan's estimates reveal that the economic value related to Circle and USDC could add as much as $60 billion to Coinbase's valuation, highlighting the capital that could be potentially gained from this strategic integration.
- Meanwhile, the strategic decision made by Circle to pursue an IPO indicates its focus on independence in the stablecoin market, a move that will have a significant impact on the stablecoin market's evolution and the overall digital finance landscape.
