Circle Reveals Arc Mainnet Timeline and BlackRock, DTCC Partnerships While Raising Revenue Guidance on Token Presale Windfall
Q2 2026 earnings call, August 5, 2026
Circle Internet Group used its second-quarter earnings call to unveil the most concrete details yet on Arc, the Layer-1 blockchain it has been building as a settlement layer for stablecoins and tokenized assets. The company confirmed Arc Mainnet will go live on September 16, and it named a validator cohort that includes BlackRock, DTCC, Visa, Mastercard and other major financial institutions. CEO Jeremy Allaire called it a network "no other blockchain has been built with," and the announcement came paired with two headline partnerships: DTCC will work with Circle to bring tokenized DTC-custodied securities onto Arc, while BlackRock plans to deploy its BUIDL tokenized money market fund on the network with native USDC integration.
The Arc news is not just strategic positioning, it is already showing up in the numbers. Circle disclosed a $242 million presale of the Arc token completed in the second quarter, which is driving a dramatic increase in guidance. Other revenue guidance for 2026 was raised to $310 million to $330 million, up from $150 million to $170 million, with $180 million of that increase tied directly to Arc token presale revenue that will be recognized as product milestones are hit. CFO Jeremy Fox-Geen said the company expects to achieve roughly 75% of those milestones this year. Full-year revenue-less-distribution-cost margin guidance was lifted accordingly, to 41.7%-43.7% from 38%-40%. Importantly, Fox-Geen noted that excluding the Arc contribution, the underlying business is tracking to the middle of the prior guided range, not accelerating.
Coinbase Deal Renewed, Competitive Threats Addressed Head-On
Investors have been fixated on competitive risk to USDC's distribution model, particularly after the recent OUSD stablecoin consortium announcement. Allaire tackled it directly, disclosing that Circle's agreement with Coinbase "has renewed on its existing terms," and noting that roughly 70% of companies expressing interest in rival consortium projects are already active participants in Circle's own network. When pressed by Citi's Peter Christiansen on whether Circle's economics with Coinbase constrain its ability to compete for new distribution, Allaire pointed to the Hyperliquid revenue-sharing arrangement as evidence Circle can structure complementary deals alongside Coinbase rather than being boxed in by that relationship.
Fox-Geen added color on the Hyperliquid mechanics, disclosing that at quarter-end approximately 90% of Hyperliquid's total USDC was held within Coinbase's platform and about 10% within Circle's, though he declined to detail the specific revenue split between the two companies. Allaire also framed Hyperliquid as a "liquidity supernova," a platform whose concentrated liquidity radiates influence across the broader ecosystem, which he said justifies prioritizing large distribution partnerships with venues that shape preference elsewhere.
Core USDC Metrics Show Resilience Despite Weak Crypto Markets
USDC circulation ended the quarter at $73.3 billion, up 19% year-over-year, with average circulation hitting an all-time high of $76.5 billion. Fox-Geen emphasized that this growth occurred even as broader digital asset market capitalization fell approximately 40% year-over-year, calling it evidence of "the decoupling of USDC usage from the vagaries of the digital asset markets." USDC's share of stablecoin transaction volume reached nearly 70% in June according to Visa data, up sharply from 36% a year earlier. Total revenue and reserve income came in at $701 million, up 7% year-over-year, with the reserve return rate declining 66 basis points to 3.48% as SOFR fell. Adjusted EBITDA grew 8% to $143 million, a 50% margin. Adjusted operating expenses rose 23% to $146 million, and management indicated full-year opex will land at the high end of the $570 million-$585 million guided range as the company leans into Arc-related investment.
Payments Network Accelerating Sharply Since Quarter-End
Circle's payments network, CPN, ended Q2 with annualized total payment volume near $15 billion on a trailing 30-day basis, but the more striking data point was what happened afterward: by July 31, that figure had already jumped to $23 billion, a 130% increase since the last earnings report. Financial institution enrollment grew nearly 30% quarter-over-quarter to 175 institutions, and the network now reaches more than 58 countries. Management said monetization of CPN will begin in the second half of the year, having prioritized scale over near-term revenue to date.
Long-Term Growth Framework Reiterated at 40% CAGR
Addressing investor questions about its multiyear growth algorithm, management reiterated a 40% USDC growth CAGR target through cycle, positioning it within a range of third-party projections calling for the stablecoin market to reach $1 trillion to $4 trillion by 2030, implying CAGRs of 27% to 77%. Fox-Geen pushed back on the framing of reserve income as "passive," noting the addressable market for money is roughly $120 trillion, of which $60 trillion earns no interest today, and argued Circle remains in the early innings of capturing that pool.
National Trust Bank Charter and Agentic Commerce Build-Out
Circle also highlighted receipt of its OCC National Trust Bank charter and a subsequent limited-purpose trust charter from New York State, which Allaire described as establishing "an infrastructure bank for the Internet financial system." On the agentic commerce front, management disclosed that the USDC network alongside the x402 payment protocol now handles 99.3% of agentic payments, with more than 900 paid services live in Circle's agent marketplace. A detailed roadmap and white paper on agentic finance is expected within days. Internally, Circle said 86% of employees are weekly active users of AI tools and have shipped more than 1,100 AI applications this year, part of what management described as a push toward becoming an "agentic corporation" in the second half of 2026.
On capital returns, Fox-Geen ruled out a near-term dividend, telling analysts flatly that Circle believes "the returns available to our shareholders on investing in the platform are far greater than those from paying out quarterly dividends." Management also acknowledged uncertainty around the CLARITY Act's legislative timeline in the Senate, while noting the GENIUS Act, already passed, remains the more critical piece of stablecoin legislation and is set to take effect in January 2027.