Circle Valued at $8 Billion in Historic NYSE IPO

Circle IPO Event: Impressive Numbers

Circle increased the size of its IPO from 24 million shares to 34 million, including 14.8 million issued by the company and 19.2 million from existing shareholders, according to a filing with the Securities and Exchange Commission (SEC), which said the IPO would raise $1.05 billion at $31 per share, far exceeding its original target of $600 million at a valuation of about $5.4 billion.

The $8.1 billion valuation reflects strong investor interest, with orders for shares exceeding the number of shares offered by 25 times. Major investment banks JPMorgan Chase, Citigroup, and Goldman Sachs are acting as lead underwriters, while BlackRock—which manages the $30 billion USDC reserve—is said to have purchased nearly 10% of the IPO. Cathie Wood’s ARK Invest has also expressed interest in buying up to $150 million in shares.

The Journey of Circle and USDC

Circle, founded in 2013, is the issuer of USDC – the world’s second-largest stablecoin with a market capitalization of around $61.5 billion, second only to Tether’s USDT ($153 billion). USDC is designed to maintain a 1:1 ratio with the USD, backed by liquid assets such as cash and US Treasury bonds, providing stability and transparency in the cryptocurrency market.

According to Circle, USDC has processed more than $25 trillion in on-chain transactions since its launch in 2018, becoming a mainstay in decentralized finance (DeFi) and cross-border payments.

Circle previously canceled plans to list through a SPAC deal in 2022, when it was valued at $9 billion.

The decision to return to a traditional IPO shows Circle’s confidence in the growth potential of stablecoins, especially as the US regulatory environment becomes more favorable with the GENIUS Act – the first legal framework for stablecoins.

A turning point in bringing non-traditional finance into CeFi

The IPO provided Circle with a significant amount of capital to invest in technology, expand its payments network, and improve regulatory compliance. Circle’s revenue grew from $15 million in 2020 to $1.89 billion in 2024, with EBITDA reaching $215.92 million over the past 12 months. However, a 42% decline in 2024 net income due to high distribution costs (mainly through Coinbase) suggests that Circle needs to optimize its business model to sustain growth.

Circle’s IPO is a positive sign for the crypto industry, especially as stablecoins become increasingly integrated into traditional financial systems. With the stablecoin market forecast to reach $500-750 billion in the future, Circle is well-positioned to capitalize on this trend. However, competition from Tether, Ripple, and new projects will require Circle to constantly innovate.

Strong interest from investors like BlackRock and ARK Invest shows confidence in the potential of stablecoins. However, whether CRCL’s stock can sustain its post-IPO momentum remains a question mark, especially as the $8.1 billion valuation is considered reasonable but not too high compared to previous expectations. Investors should keep a close eye on Circle’s regulatory moves and financial performance in the coming quarter.

Conclusion and evaluation

Circle’s IPO, with a valuation of $8.1 billion and $1.05 billion raised, marks a watershed moment for the crypto industry. The NYSE listing not only solidifies USDC’s position, but also cements the role of stablecoins in the global financial system. However, with increased competition and new regulatory pressures, Circle will need to continue to innovate to maintain its growth momentum.

For investors and the crypto community, Circle’s IPO is a remarkable event that opens up opportunities but also comes with risks. Can CRCL become a “star” on the NYSE? Only time will tell.

Once again we give our opinion on potential projects in the crypto market. This is not investment advice, consider your portfolio. Disclaimer: The views expressed in this article are solely those of the author and do not represent the platform in any way. This article is not intended to be a guide to making investment decisions.

Compiled and analyzed by HCCVenture

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