JPMorgan says Hyperliquid's rise threatens Circle's USDC economics

FinanceJPMorgan says Hyperliquid's rise threatens Circle's USDC economicsHyperliquid's deal with Circle and Coinbase creates a "prisoner's dilemma" that puts pressure on earnings from the dollar-pegged stablecoin.By Will Canny, AI Boost|Edited by Sheldon Reback Jul 14, 2026, 2:57 p.m. 2 min readMake preferred on ShareShare this articleCopy linkX iconX (Twitter)LinkedInFacebookEmailMake preferred on SummaryShowJPMorgan said a new arrangement with Hyperliquid is a near-term revenue headwind for Circle and Coinbase, with a greater long-term threat to Circle's USDC economics. The bank argued the deal exposes a "prisoner's dilemma," encouraging Circle and Coinbase to compete for USDC distribution at the expense of each other's economics. The Wall Street firm lowered earnings estimates for both firms, citing the Hyperliquid changes alongside weaker crypto trading volumes and asset prices.JPMorgan (JPM) lowered its forecasts for Circle Internet (CRCL) and Coinbase (COIN), saying their revamped agreement with Hyperliquid weakens the economics of Circle's USDC and posed a bigger long-term threat to the stablecoin issuer.The bank said the deal created a "prisoner's dilemma," incentivizing stablecoin issuer Circle and crypto exchange Coinbase to compete for distribution of the dollar-pegged token at the expense of each other's economics. Hyperliquid, now one of the largest crypto trading venues, holds about $6 billion of USDC, or roughly 8% of the circulating supply, JPMorgan estimated."We think the change in the Hyperliquid relationship showcases the challenge for Circle and Coinbase partnership agreements because it can create 'a prisoner’s dilemma' that drive Coinbase and Circle to compete with each other when promoting USDC distribution," analysts led by Kenneth Worthington said in the Tuesday report.Hyperliquid is one of crypto's fastest-growing trading venues and the leading decentralized perpetual futures exchange. The platform processed more than $150 billion in tra…

JPMorgan says Hyperliquid's rise threatens Circle's USDC economics

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