USDC redemptions just outpaced mints by $4B, but a massive new token presale is quietly doubling Circle’s revenue outlook

Circle’s reserve engine absorbed a tough second quarter. Gross USDC redemptions exceeded mints by about $4 billion, and reserve yield slipped, while a larger balance base kept reserve income growing.

Its biggest opportunity sits outside its reserves. Circle doubled the midpoint of its full-year other revenue outlook, which includes an undisclosed contribution from the ARC Token presale.

Circle’s Aug. 5 earnings release puts the gross flows at $87 billion redeemed and $83 billion minted. Those rounded figures produce the roughly $4 billion gap.

For Circle Mint customers, minting turns fiat into USDC, and redemption turns USDC back into fiat, according to Circle’s regulatory filing. The $4 billion difference describes customer flow activity, separate from reserve adequacy.

Quarter-end USDC circulation was $73.3 billion, against a $76.5 billion quarterly average. It remained 19% higher than a year earlier.

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Circle’s reserve return rate fell 66 basis points year over year to 3.5%. The larger average USDC balance absorbed the rate hit, lifting reserve income 5% to $667.7 million.

The 66-basis-point drop is a year-over-year comparison. The Federal Reserve held its target range at 3.50% to 3.75% in both April and June. Circle’s 3.5% figure measures the return on its reserve portfolio.

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Other revenue outlook jumps into view

Other revenue remained small beside reserve income, though it climbed 41% year over year to $33.582 million. Circle rounded that to $34 million and credited growth in subscription and services revenue.

The outlook changed much faster. Circle raised FY2026 other revenue guidance to $310 million to $330 million from the $150 million to $170 million range issued in May. The midpoint leaped from $160 million to $320 million.

The revised range includes recognized ARC Token presale revenue. Circle provided no breakdown for that contribution, leaving presale revenue mixed with the rest of the outlook.

Arc is Circle’s blockchain network. The company previously disclosed about $222 million in estimated gross proceeds from the initial ARC Token closing, plus another $20.25 million from a second closing. The two closings total about $242.25 million in estimated proceeds. That figure is different from recognized revenue, and the purchase agreements carry repayment rights under specified circumstances.

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