Circle Q2 Financial Report: Stablecoin business revenue soared by 53%, USDC market capitalization surged by 90%! However, IPO costs led to a quarterly loss of $482 million | CRCL stock price spiked and then retreated after hours.

Circle, the world's leading stablecoin issuer, ( US stock code: CRCL), released a strong Q2 financial report: core stablecoin business revenue grew by 53% year-on-year to $658 million, and the flagship product USDC (US Dollar stablecoin) market capitalization surged by 90% to $61.3 billion. Despite showing a 38% gross margin (excluding distribution costs), the company recorded a net loss of $482 million due to one-time expenses of $591 million related to the IPO. Investors responded positively to Circle's newly launched "Payment Network" and blockchain project Project Arc (, pushing the pre-market stock price of CRCL up by 14.66%, although the intraday gain narrowed to 1.27%. This article provides an in-depth analysis of Circle's business growth drivers, cost structure, and ecological expansion strategy.

Core business strong: Revenue surged 53%, USDC market capitalization exceeded 61 billion The leading stablecoin issuer in the United States, Circle, announced its second-quarter performance, with strong results in its core business:

• Total Revenue: Reached $658 million, a significant increase of 53% compared to the same period last year.
• USDC Market Capitalization: Its flagship product, the US dollar stablecoin USDC circulating market capitalization surged by 90%, reaching $61.3 billion by the end of the reporting period, significantly reclaiming its previous market share.

IPO costs drag down profits, high distribution expenses become a hidden concern Despite strong revenue growth, Circle recorded a net loss of $482 million this quarter. The main reason for the loss was a one-time expense of $591 million related to the initial public offering )IPO(. After deducting the USDC distribution costs paid to partners (mainly Coinbase), Circle shows a healthy gross margin of 38%. However, the high distribution fees paid to partners such as Coinbase remain a key challenge for sustainably improving profitability in the future.

Ecosystem Expansion: Payment Network Launch, Arc Blockchain Constructs "Stablecoin Financial Layer" Investor optimism towards Circle mainly stems from its proactive ecosystem expansion plans:

1. Circle Payment Network)Circle Payments Network(:
   • Officially launched in May, focusing on providing dedicated payment channels.
   • Currently operating 4 payment routes.
   • Plans to establish cooperation with over 100 financial institutions within this year.
2. Project Arc ):
   • Positioned as an open-source blockchain network specifically designed for stablecoin finance.
   • USDC will serve as the native Gas token of this Blockchain.
   • Technical Highlights: Compatible with Ethereum Virtual Machine (EVM), Sub-second transaction speed, Built-in foreign exchange conversion engine, Privacy features.
   • Strategic Integration: Circle plans to deeply integrate the Arc Blockchain with its Payment Network, aiming to create a complete closed-loop system covering payments and settlements.
   • Progress: The public testnet is expected to launch in this autumn.

Growth Target: USDC annual growth rate of 40%, building a full-stack financial infrastructure Circle has set an ambitious annual growth rate target of 40% for its core product USDC. With the launch of the Arc Blockchain and the expansion of the Payment Network, the company's long-term vision is to become a stablecoin-driven full-stack payment and settlement infrastructure provider.

Market Reaction: Pre-market surged 14.66%, intraday gains narrowed indicating market caution Strong revenue growth and a grand ecological blueprint initially ignited investor enthusiasm:

• Pre-market Trading: CRCL stock price rose by 14.66%, significantly exceeding market expectations. However, as the regular trading session begins, the optimistic sentiment has cooled somewhat.
• Intraday Performance: The stock price gave back most of its rise, ultimately closing up only 1.27%. This indicates that the market is adopting a cautious stance after digesting the impact of IPO costs and assessing the prospects of the new business.

Conclusion: Circle's Q2 financial report demonstrated strong growth momentum in its stablecoin core business (revenue +53%, USDC market capitalization +90%), but high IPO costs led to book losses, and the ongoing USDC distribution fees compressed profit margins. The company is actively transforming into a "stablecoin financial full-stack service provider" by launching a dedicated payment network and building the native blockchain Arc (with USDC as the gas token), aiming for an annual growth rate of 40% for USDC and creating a payment-settlement closed loop. Despite the strategic blueprint gaining initial recognition (big pump in pre-market), the significant narrowing of CRCL's intraday gains reflects the market's cautious assessment of its new business execution efficiency, profit improvement pathway, and whether it can achieve its goals amid fierce competition. Progress of the Arc testnet and the implementation of payment network partnerships will be key observation points in the next phase.