Coinbase’s (COIN) partnership with Circle (CRCL) and exposure to Circle's USDC stablecoin is generating significant financial upside, both through equity appreciation and high-margin revenue streams, according to a new report from Wall Street bank JPMorgan.

The total value of Circle-related economics to Coinbase shareholders is estimated at $55 to $60 billion, the bank said, suggesting the market may be underestimating the strategic importance of the USDC ecosystem.

The crypto exchange holds 8.5 million shares in Circle, valued at $1.6 billion as of July 25. The larger story, however, lies in USDC-related income, according to the report.

In the first quarter of this year alone, Coinbase earned roughly $300 million in distribution payments from Circle, more than Circle’s total net revenue of $230 million.

The bank estimated that Coinbase had $13 billion in USDC balances on-platform at the end of the first quarter, generating $125 million in revenue at 20–25% margins.

Off-platform, Coinbase splits Circle Reserve Fund income 50/50, pulling in $170 million last quarter at nearly 100% margin, the report added.

The bank has a neutral rating on Coinbase stock with a $404 price target. The shares were around $381 in early trading Tuesday.

Read more: CoinDCX Dismisses Report of Coinbase Acquisition Talks

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