Coinbase’s potential pivot into a new stablecoin platform backed by Stripe, Visa and Mastercard has rattled markets and put fresh pressure on Circle, the issuer of USDC.
What happened
- CoinDesk reported that Coinbase Global is evaluating whether to join a payments-focused stablecoin infrastructure being developed with Stripe, Visa and Mastercard. That platform could operate outside the USDC ecosystem or shift some payment flows away from Circle’s network.
- The news hit stocks: Circle shares dropped as much as 4% soon after Tuesday’s open, while Coinbase slid about 1.4% in the same session. Visa and Mastercard also fell more than 2% that morning.
- Crypto market stress added to the move — Bitcoin traded near $66,800 after a roughly 2.8% 24-hour fall, an earlier intraday dip toward $65,000, and about $1.8 billion in liquidations across crypto markets.
Market and retail reaction
- Retail sentiment tracked on Stocktwits turned bearish for both Circle and Coinbase over the past day. Message volume jumped sharply: Circle mentions rose ~40% in 24 hours, and both Circle and Coinbase saw message volume surge more than 150% over the past month.
- Retail sentiment was split on the card networks: Visa trended bearish while Mastercard moved to extremely bullish from previously bullish.
Why this matters for Circle and Coinbase
- Circle’s business is tightly linked to USDC. Company filings cited in the report show reserve income is a major revenue driver: Circle earned about $2.64 billion in 2025 revenue from income on assets backing USDC.
- Coinbase and Circle already have a 2023 revenue-sharing arrangement: Coinbase keeps all interest income on USDC held on its exchange and splits revenue equally with Circle on USDC circulating off-exchange.
- Coinbase CEO Brian Armstrong told investors on the Q1 earnings call that those contracts “were already in place” and the company expected to continue the relationship under the same terms. Still, the CoinDesk report raised the possibility that Coinbase could gain leverage in upcoming negotiations if it joins an alternative stablecoin platform before a contract renewal expected in August.
What to watch
- Whether Coinbase formally joins or backs the new payments-focused stablecoin infrastructure.
- Any changes to the USDC revenue-sharing terms when the agreement comes up for renewal later this year.
- Market flows away from USDC toward any new network supported by major payments players, and broader effects on stablecoin competition and payment rails.
Bottom line: A payments-industry-backed stablecoin initiative with Coinbase considering participation creates a potential new rival to Circle’s USDC franchise and has already produced short-term market jitters — the real impact will depend on formal commitments and how the upcoming contract renewal plays out.
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