2025-04-02
On April 1, 2025, Circle, the company behind the USDC
stablecoin, has officially filed Form S-1 for an initial public offering (IPO) with the
U.S. Securities and Exchange Commission (SEC), aiming to go public on the New
York Stock Exchange under the ticker symbol CRCL.
This is Circle’s second attempt to
enter the public markets. Its previous effort, a merger with a SPAC, collapsed
in late 2022 due to regulatory hurdles.
This time, Circle is proceeding with a
traditional IPO, tapping JPMorgan Chase and Citigroup as lead underwriters, and
reportedly targeting a valuation of up to $5 billion.
The IPO filing comes at a volatile time
for tech and crypto-related stocks. The Nasdaq just wrapped up its worst
quarter since 2022, and the IPO market for tech has been sluggish for over
three years.
Still, there are signs of renewed
investor interest, with companies like Klarna, Hinge Health, StubHub, and
CoreWeave also entering the pipeline.
Founded in 2013, Circle is best known
for issuing USD Coin (USDC), the second-largest stablecoin by market cap behind
Tether (USDT). Pegged 1:1 to the U.S. dollar and backed by cash and short-term
Treasuries, USDC currently has $60 billion in circulation—accounting for about
26% of the global stablecoin market.
It has grown 36% this year, far
outpacing Tether’s 5% growth.
According to Circle’s SEC filing, the
company generated $1.68 billion in revenue and reserve income in 2024,
up from $1.45 billion in 2023.
However, net income fell to $156
million, down from $268 million a year earlier, reflecting increased costs,
particularly a $908 million payout to Coinbase, Circle’s main USDC
distribution partner.
Coinbase and Circle maintain a
revenue-sharing agreement, splitting USDC profits 50-50.
Coinbase CEO Brian Armstrong recently
stated the company has a “stretch goal to make USDC the number one stablecoin,”
indicating how central this partnership is to both firms' strategies.
Circle’s business is largely dependent
on stablecoin reserves, which made up over 99% of its revenue in 2024.
The firm also holds digital assets
including Bitcoin ($6.2 million), Ether ($3.3 million), Sui ($5.6 million),
Aptos, Optimism, and Sei. The company has also made moves to align
itself with global finance, relocating its headquarters to One World Trade
Center in New York last year.
Beyond the U.S., Circle made headlines
last week as the first stablecoin issuer to receive regulatory approval in Japan,
launching USDC on the SBI VC Trade exchange on March 26.
Circle’s IPO signals a shift in
sentiment around crypto market. With the Trump administration showing a more
crypto-friendly stance and stablecoin legislation potentially on the way.
A successful IPO would place Circle
alongside Coinbase as one of the few pure-play crypto firms on a U.S. exchange.
Other crypto companies including Kraken
and BitGo are also reportedly exploring IPOs in 2025 or 2026, as the industry
continues to mature and integrate deeper into traditional financial systems.
