Circle Pays Binance $60.25 Million to Promote USDC in Strategic Partnership

Circle has paid Binance $60.25 million as a one-time upfront fee to promote USDC on its platform, according to Circle's IPO S-1 filing submitted to the U.S. Securities and Exchange Commission (SEC) on April 2nd. The arrangement, finalized in November 2024, establishes Binance as the first approved participant under Circle's Stablecoin Ecosystem Agreement.

The two-year partnership includes two key components: a marketing agreement and a treasury arrangement. Under the terms, Binance will promote USDC on its platform and maintain a portion of its treasury reserves in USDC. In addition to the upfront payment, Circle has agreed to pay Binance monthly incentive fees based on the amount of USDC held on Binance's platform and in its treasury.

These incentive fees represent a percentage ranging from "an annualized mid-double-digit to high double-digit percentage of a fixed rate," which is reset quarterly based on a discount to the three-month SOFR (Secured Overnight Financing Rate), depending on balances held.

Importantly, the monthly incentive fees are payable only if Binance maintains at least 1.5 billion USDC in its treasury. Binance has also committed to keeping 3 billion USDC in its treasury, though certain exceptions apply.

While the agreement has a two-year term, both parties can terminate it early under specific circumstances. If Binance terminates the marketing arrangement early, it must continue payment and promotional obligations for one more year, albeit at reduced rates.

This partnership comes at a time of significant growth for the USDC ecosystem. According to Circle's recent report, USDC in circulation has grown by over 78% year-over-year, outpacing all other large global stablecoins. Monthly transaction volume reached $1 trillion in November 2024 alone, with all-time volume surpassing $18 trillion.

The USDC stablecoin is now accessible through more than 500 million end-user wallet products worldwide, supporting various use cases from crypto capital markets to an increasing number of payment applications globally.