Circle and Binance announced a new five-year commercial agreement on September 22, with Binance investing $100 million in Circle's Class A shares at $80.84 each, a 5% discount to Circle's September 17 closing price. The investment comes as USDC, Circle's stablecoin, has emerged as one of Binance's most important distribution channels.
USDC customer balances on Binance have grown substantially under the partnership. As of October 1, 2024, shortly before the original agreement in November, customers held approximately $1.5 billion of USDC on the exchange. By September 1, 2025, that figure reached $7.1 billion, representing a 376% increase. Over the same period, total USDC in circulation grew approximately 87%, meaning Binance's share of global USDC supply expanded from less than 4% to almost 10%.
The expansion has also reshaped the stablecoin landscape on Binance. Customer USDT balances held at $21.4 billion in October 2024 compared with $1.5 billion of USDC, a ratio of roughly 14.3-to-1. By September 2025, USDT reached $32.3 billion while USDC hit $7.1 billion, narrowing the ratio to approximately 4.5-to-1. USDT balances increased about 51% over the period compared with USDC's 376% increase.
Circle has paid significantly for this distribution growth. Under the November 2024 agreement, Circle provided Binance with a $60.25 million upfront fee and committed to monthly incentive payments based on USDC held on the platform. These payments ranged from mid-double-digit to high-double-digit percentages of a fixed rate. An additional August 2025 agreement expanded the arrangement around USDC held through Circle's Modular Smart Contract Wallet infrastructure.
The financial impact on Circle's margins is substantial. In the second quarter, Circle generated approximately $668 million of reserve income while reporting roughly $410 million of distribution and transaction costs, equivalent to about 61% of reserve income. Distribution costs specifically related to Binance increased by $152.1 million in 2025 as the relationship expanded.
According to analysis by Clear Street, if Binance receives high-double-digit share of incentive payments as in earlier terms, Circle could retain only approximately $4 million to $7 million in annual net income from an additional $1 billion of USDC at a 3.5% reserve return.
The new agreement consolidates previous arrangements and includes Binance acquiring a roughly 0.5% equity stake in Circle. Binance has committed to a two-year restriction on selling, pledging, or hedging its shares. Either company can terminate the commercial agreement before its September 2031 expiration under specified circumstances.
