Circle partners with Bybit in push to extend USDC adoption beyond Coinbase ecosystem

Circle and Bybit — operators of the world’s second-largest stablecoin and second-largest crypto exchange, respectively — are joining forces in a partnership that could have a significant impact on how digital assets move across the globe.

Under the partnership announced Monday, Bybit, the second-ranked exchange globally in terms of trading volume, will increase USDC’s presence across its ecosystem by boosting liquidity in spot and derivatives markets, expanding the stablecoin's use in savings, payments, and card rewards, and integrating Circle’s fiat on- and off-ramp infrastructure to make deposits and withdrawals faster and more transparent. Traditionally, like most exchanges, Bybit has primarily relied on Tether's USDT stablecoin.

From Circle's perspective, which has long been heavily dependent on top U.S.-based exchange Coinbase, the stablecoin issuer will have the opportunity to be utilized across an ecosystem with increased global reach. Some analysts have suggested Circle's stock could suffer if USDC's circulation and adoption growth stagnate.

Circle's drive to narrow the gap between it and Tether could come down to adding global partners able to expose more traders to USDC. Almost a year ago to the day, Binance, the world's largest crypto exchange, also partnered with Circle to expand USDC's availability across its platform for trading, saving and payments.

USDC's circulation is currently about $78 billion while USDT sits at $186 billion, according to The Block Data Dashboard.

Bybit grows credibility

It appears Bybit is taking the stance that working with Circle will boost its credibility, with Monday's statement referencing USDC as "the world’s largest regulated stablecoin," a statement Tether might take issue with. 

"Bybit’s partnership with Circle represents a major milestone in our mission to offer a fully compliant, liquid, and user-friendly ecosystem," Bybit co-founder and CEO Ben Zhou said.

The exchange also pointed out it recently secured a Virtual Asset Platform Operator License from the UAE’s Securities and Commodities Authority in addition to expanding "its regulatory oversight across the European Economic Area (EEA), Turkey, and other jurisdictions around the world."