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3d ago

Binance Buys $100 Million Stake in Circle and Signs Five‑Year USDC Promotion Deal

Formalizing Binance’s paid role promoting USDC, the deal preserves voting rights for a locked equity position and leaves key fee rates and minimum balance commitments undisclosed.

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Figurines with computers and smartphones are seen in front of Binance logo in this illustration taken, February 19, 2024. REUTERS/Dado Ruvic/Illustration
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Overview

  • The private placement, which closed on Thursday, Sept. 17, gave Binance about 1.24 million Class A Circle shares at $80.84 each for roughly $100 million and was disclosed in a Sept. 22 SEC filing.
  • The equity came with a five‑year commercial agreement under which Circle will pay Binance monthly incentive fees tied to USDC balances held through Circle’s Modular Smart Contract Wallet and Binance will promote the stablecoin on its platform.
  • Binance must not sell, transfer, pledge or hedge the shares for up to two years but retains the shares’ voting rights and the lockup can end sooner if Binance exits the commercial arrangements under specified conditions.
  • The shares were sold in an unregistered private placement, which limits Binance’s ability to resell them unless they are registered or an exemption applies, and Circle said the $80.84 price was a discount to pre‑sale market value.
  • The pact replaces earlier 2024–25 USDC deals and deepens a costly distributor model for Circle that analysts say raises questions about how much distribution fees will cut into Circle’s reserve income and margins as USDC use grows.