USDC issuer Circle has filed for an IPO with the SEC, aiming for a $4-5 billion valuation, as it navigates volatile market conditions and regulatory challenges.
Circle Files for IPO
Circle Internet Financial, the issuer of the USDC stablecoin, has filed a prospectus with the U.S. Securities and Exchange Commission (SEC) for an initial public offering (IPO). The company is expected to launch its IPO by June, with investment banking giants JPMorgan Chase and Citigroup serving as lead underwriters. The stock will trade under the ticker symbol CRCL.
The IPO marks Circle’s second attempt at going public. Its previous effort, a planned merger with a special purpose acquisition company (SPAC), fell through in late 2022 due to regulatory challenges. Since then, Circle has taken strategic steps to solidify its position in the financial sector, including relocating its headquarters from Boston to One World Trade Center in New York.
Financial Performance and Valuation
Circle reported $1.68 billion in revenue and reserve income in 2024, an increase from $1.45 billion in 2023 and $772 million in 2022. However, net income declined to approximately $156 million last year, down from $268 million in the previous year. The firm is targeting a valuation between $4 billion and $5 billion, according to reports.
If successful, Circle would become one of the most significant crypto-native companies to list on a U.S. exchange, following in the footsteps of Coinbase, which went public in 2021 and currently holds a market capitalization of around $44 billion.
Navigating Market Conditions
Circle is preparing to enter the public markets amid a volatile period for tech stocks. The Nasdaq recently recorded its sharpest quarterly drop since 2022, and the IPO market for tech firms has remained subdued for over three years. Despite this, there have been signs of resurgence, with companies like Klarna, Hinge Health, and StubHub filing for IPOs. Additionally, AI infrastructure provider CoreWeave recently launched the largest venture-backed tech IPO in the U.S. since 2021, though its stock initially struggled before recovering.
USDC’s Market Position
As the issuer of USD Coin (USDC), Circle operates the world’s second-largest stablecoin by market capitalization. USDC, pegged one-to-one with the U.S. dollar and backed by cash and short-term Treasury securities, currently has approximately $60 billion in circulation. It accounts for about 26% of the total stablecoin market, second to Tether’s 67% dominance. However, USDC has experienced a 36% market cap growth this year, outpacing Tether’s 5% increase.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.