Hyperliquid-Coinbase-Circle Deal Boosts HYPE While Pressuring Stablecoin Margins

Hyperliquid’s latest partnership with Coinbase (COIN) and Circle (CRCL) is reshaping the stablecoin business model by redirecting reserve yield profits from issuers toward crypto trading platforms. The move is expected to strengthen Hyperliquid’s revenue stream, increase buying pressure on the HYPE token, and reduce earnings potential for Circle and Coinbase.

Under the agreement announced last week, Circle’s USDC becomes the official “Aligned Quote Asset” (AQA) on Hyperliquid, one of the fastest-growing perpetual futures exchanges in crypto. Coinbase will manage treasury deployment for most USDC reserves on the network, while Circle will oversee minting, redemption, and cross-chain infrastructure support.

Although exact revenue-sharing details remain undisclosed, analysts estimate Hyperliquid could receive up to 90% of the reserve income generated by USDC deposits on the platform. Previously, most of this revenue went directly to Circle and Coinbase.

Syncracy Capital co-founder Ryan Watkins described the partnership as potentially Hyperliquid’s most important announcement of the year. He explained that the exchange will now benefit from both trading fees and stablecoin yield revenue, creating a more stable and scalable business model.

With more than $5 billion in USDC currently held on Hyperliquid, analysts believe the protocol could generate between $135 million and $160 million annually from stablecoin yield sharing alone. If deposits continue growing, projected annual revenue could eventually reach $300 million to $500 million.

The market has already reacted positively, with HYPE rising nearly 10% over the past week despite broader weakness across the crypto market.

Meanwhile, Compass Point analysts estimate the new structure could reduce annual EBITDA for Circle and Coinbase by $60 million to $80 million combined. The broader concern is that other DeFi platforms, including Polymarket and Jupiter, may seek similar revenue-sharing agreements.

Industry experts also believe the deal signals growing consolidation within the stablecoin sector, potentially strengthening dominant assets like USDC while reducing the need for smaller competing stablecoins.