In Circle’s Q3 earnings report, the figures most likely to draw attention are the $865 million in revenue and reserve income.
But what’s really worth a closer look is that USDC on-chain transaction volume grew 49% year over year. Reserve income is still supported by interest on U.S. Treasuries, while the recovery in transaction volume looks more like a return of real demand for use.
Source: BlockBeats. Related assets: CRCL and USDC; outlook is bullish. The risk is straightforward: when rate cuts begin, reserve interest income will be directly squeezed, and transaction volume and issuance scale will need to make up the difference.
Scenario 1: If USDC continues to expand its share of payments and settlement, transaction volume growth will be more than just a figure in an earnings report. Scenario 2: If the interest-rate outlook shifts, putting pressure on reserve income, whether the business can withstand it will depend on issuance scale. Are you more focused on a recovery in USDC’s market share or on how sensitive reserve income is to interest rates?
Image 1: Circle Q3 revenue and reserve income of $865 million; USDC on-chain transaction volume up 49% year over year · Key takeaways
Image source: https://www.theblockbeats.info/flash/375503
But what’s really worth a closer look is that USDC on-chain transaction volume grew 49% year over year. Reserve income is still supported by interest on U.S. Treasuries, while the recovery in transaction volume looks more like a return of real demand for use.
Source: BlockBeats. Related assets: CRCL and USDC; outlook is bullish. The risk is straightforward: when rate cuts begin, reserve interest income will be directly squeezed, and transaction volume and issuance scale will need to make up the difference.
Scenario 1: If USDC continues to expand its share of payments and settlement, transaction volume growth will be more than just a figure in an earnings report. Scenario 2: If the interest-rate outlook shifts, putting pressure on reserve income, whether the business can withstand it will depend on issuance scale. Are you more focused on a recovery in USDC’s market share or on how sensitive reserve income is to interest rates?
Image 1: Circle Q3 revenue and reserve income of $865 million; USDC on-chain transaction volume up 49% year over year · Key takeaways
Image source: https://www.theblockbeats.info/flash/375503
