Circle Internet and Coinbase: Impact of Hyperliquid USDC Relationship to Weigh on Both CRCL and COIN — The Prisoner’s Dilemma; Also Marking Models Ahead of 2Q26 EPS

Research evidence excerpt

Circle Internet and Coinbase: Impact of Hyperliquid USDC Relationship to Weigh on Both CRCL and COIN — The Prisoner’s Dilemma; Also Marking Models Ahead of 2Q26 EPS

J P M O R G A N North America Equity Research

14 July 2026

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Circle Internet and Coinbase

Impact of Hyperliquid USDC Relationship to Weigh on

Both CRCL and COIN — The Prisoner’s Dilemma; Also

Marking Models Ahead of 2Q26 EPS

On May 14, Circle Internet (CRCL) and Coinbase (COIN) announced a new Brokers, Asset Managers &

partnership with Hyperliquid to support broader USDC adoption. Here we outline Exchanges

the P&L impact for both Circle and Coinbase as the updated arrangement presents Kenneth B. Worthington, CFA AC

significantly different economics. Net/net, we think the arrangement presents a net (1-212) 622-6613

near-term revenue headwind for both Circle and Coinbase. We think the change in kenneth.b.worthington@jpmorgan.com

the Hyperliquid relationship showcases the challenge for Circle and Coinbase Madeline Daleiden

partnership agreements because it can create “a prisoner’s dillemma” that drive (1-212) 622-4911

Coinbase and Circle to compete with each other when promoting USDC madeline.daleiden@jpmchase.com

distribution. We lower estimates for both Coinbase and Circle as it pertains to the Michael Cho

(1-212) 622-3619

new Hyperliquid economics; furthermore, we also see both Coinbase and Circle michael.cho@jpmchase.com

as being negatively impacted by more challenging cryptocurrency market J.P.