USDC Issuer Circle Cuts 5% of Staff in $9.1M Restructuring

Severance Charges in a Profitable Quarter

Circle, the company behind the USDC stablecoin, cut about 5% of its workforce in the third quarter, a step the company disclosed in footnotes to its third-quarter earnings filing published Wednesday, November 4. The filing says the reduction was intended to bring the company's structure into line with its operating model and strategic priorities, and it names neither the number of employees affected nor the teams involved. The quarter carried $9.1 million in restructuring expenses, mostly cash outlays for notice periods and severance, plus employee benefits and adjacent costs, partly offset by a $5.7 million reversal of stock-based compensation as departing staff forfeited unvested shares.

The cuts landed in a financially strong quarter: net income from continuing operations rose 5% year on year to $226 million, total revenue and reserve income climbed 17% to $865 million, and adjusted EBITDA jumped 85% to $317 million. Our Circle earnings preview had framed the report around USDC supply rather than headcount, and the USDC price held its dollar peg through the session. Chief executive Jeremy Allaire made no public comment on headcount; his remarks on the results centered on growth.

The reduction makes Circle the latest in a string of crypto employers to shrink this year: Coinbase cut 14% of its staff in May, with chief executive Brian Armstrong pointing to the bear market and the company's adoption of AI; the Ethereum Foundation cut 20% in June; custody firm BitGo trimmed 15% the same month; exchange Luno cut a fifth of its global workforce in July; and ETF issuer Bitwise cut 14% in August. For Circle, it is a second reduction, following a cut of just under 6% of jobs in December 2024.

Reserve Yield Falls to 3.5%

Reserve income, the interest Circle earns on the Treasury bills and cash backing USDC and the issuer's main source of passive income, fell 8% to $658 million from roughly $711 million a year earlier. The filing puts the return on reserves at 3.5%, down 0.61 percentage points, and each Federal Reserve rate cut lowers the yield on the assets behind the token. Average USDC in circulation rose 8% year on year to $73.3 billion, but the stock ended September flat at $73.9 billion, and USDC's share of the dollar-pegged stablecoin market slipped 1.83 points to 27%. That flat figure follows the $800 million seven-day drop in circulation reported earlier.

Other revenue rose to $207 million, and $182 million of it came from the presale of ARC, the token of the Arc blockchain, which opened its public mainnet on September 16 with 11 founding validators; BlackRock, DTCC and Visa sit among its permissioned validators. In a post on X, Allaire said USDC carried 79% of all stablecoin transaction volume in the quarter, up from 66% a year earlier, and that the Circle Payments Network ended it at about $41 billion in annualized volume, up 15-fold, with 205 financial institutions enrolled. He also cited a record $208 billion of USDC minted and redeemed, about $2.3 billion a day. “In January, the GENIUS Act takes effect and regulated digital dollars go mainstream,” he wrote.

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Distribution costs, the interest Circle passes to partners that distribute USDC, fell to $409.2 million from $447.2 million, while operating expenses rose 16% to $244.9 million. The company held full-year guidance for adjusted operating expenses at $570 million to $585 million and said the final figure will depend on hiring. It also disclosed an agreed purchase of payments firm Tazapay and kept a target of 40% annual USDC growth over several years.

Why Cut Now?

Read against the filing, the restructuring answers a revenue problem rather than a demand problem. Reserve income is the core of how a stablecoin issuer makes money, and that line contracted 8% even as circulation held at $73.9 billion; strip out the one-time $182 million ARC presale and much of the quarter's 17% revenue growth disappears. Every further rate cut compresses the yield on the reserve portfolio, so Circle is trimming fixed costs into a thinner interest margin. The $5.7 million forfeited-share reversal blunts this quarter's charge, but the structural savings land in 2026, in an expense line the company has capped at $570 million to $585 million depending on hiring. With the GENIUS Act due in January, the cut closes a quarter Circle itself characterized as strong, not one it called weak.