Circle’s Capital Race as the “First Stock of Stablecoin”
At a critical juncture where the U.S. GENIUS stablecoin bill enters its final gaming phase, Circle has simultaneously pressed the fast-forward button on its IPO sprint, attempting to ring the bell on Nasdaq as the “first stock of stablecoin,” with its first trading day set to commence on June 5.
At this intersection of policy signals and market bets, four years after Circle’s push for an IPO, existing shareholders can finally cash out significantly through the IPO window, reaping returns multiple times over; concurrently, Circle is leveraging favorable policies to increase its issuance scale and pricing range, attracting endorsements from Wall Street giants such as BlackRock and JPMorgan. The underlying logic here involves not only a gamble on the prospects of the U.S. legitimizing compliant stablecoins but also a reassessment of Circle’s global expansion capabilities and the dominant position of USDC in the ecosystem.
Investment Institutions Welcoming Exit After Over 11 Years, Wall Street “Takes Over” Subscription
After experiencing a halted SPAC listing plan in 2022, turbulent market share for USDC stablecoin, and increasingly stringent global regulations, Circle has ultimately restarted its IPO process, opening a new channel for crypto financial companies to enter traditional capital markets.
According to the prospectus initially submitted to the U.S. SEC, Circle plans to issue 24 million Class A common shares, of which the company will issue 9.6 million shares, with the remaining 14.4 million shares sold by existing shareholders, aiming for a price range of $24 to $26 per share. This ratio of secondary shares held by investors far exceeds the primary issuance structure of the company, which is extremely rare in tech company IPOs, typically occurring only when founders and early investors wish to partially exit during the IPO stage or attempt to mitigate dilution effects.
However, shortly thereafter, Circle raised the scale and price range of the IPO: the new plan is to issue 32 million shares, with the company’s own issuance proportion significantly increased to 24 million shares, while the sale size of existing shareholders decreased to 8 million shares, and the pricing range was raised to $27 to $28 per share. At the high end, this transaction could raise up to $896 million, bringing the company’s valuation close to $6.2 billion. When considering potential dilution factors such as employee stock ownership plans, restricted stocks (RSUs), and warrants, the fully diluted valuation would be about $7.2 billion.
Notably, the list of shareholders participating in this share sale includes not only Circle co-founders Jeremy Allaire and Sean Neville but also well-known venture capital institutions such as Accel, Breyer Capital, General Catalyst, IDG Capital, and Oak Investment Partners, with these institutions averaging a shareholding reduction of 8% to 10%. According to PANews statistical financing timelines, these institutions’ investment dates back as early as 2013, spanning over 11 years.
Compared to the unsuccessful SPAC transaction in 2022 (which had a valuation of $9 billion), this IPO returns at a slightly lower valuation, but the structure is more robust, and market feedback is more positive.
Moreover, according to Bloomberg citing informed sources, Circle’s IPO subscription orders have exceeded the number of shares available for issuance by several times. For example, ARK Investment Management, a tech investment firm founded by Cathie Wood, has expressed interest in purchasing up to $150 million worth of Circle stock; simultaneously, global asset management giant BlackRock is also planning to acquire about 10% of the IPO shares, which based on the pricing range, amounts to approximately $86.4 million to $89.6 million.
Pricing Strategy or Reservation of Growth Potential, Coexisting Growth and Concerns
As the stablecoin sector accelerates its compliance evolution and the crypto industry moves toward mainstream acceptance, Circle’s submission of the IPO prospectus is not just a capital market sprint but also an “arbitrage” against the U.S. regulatory cycle. If successfully listed, Circle will become the first stablecoin issuer to enter the U.S. stock market, symbolically significant akin to Coinbase’s listing moment.
With strong profitability, solid compliance advantages, extensive market expansion capabilities, and endorsements from traditional financial giants like BlackRock, Circle has constructed a narrative framework of quality assets. On one hand, according to the prospectus, Circle’s total revenue is projected to reach $1.676 billion in 2024, an approximately 15.6% year-on-year increase from $1.45 billion in 2023. The stablecoin market is currently in a phase of rapid expansion, yet projects with strong profitability and clear financial data are few, making Circle’s revenue growth undoubtedly a rare label.
Moreover, the core product USDC has already become the second-largest stablecoin globally, with its market capitalization exceeding $61.4 billion. Although there remains a significant gap in market share compared to USDT, USDC has established a strong cognitive moat in terms of compliance, transparency, and regulatory oversight. Additionally, USDC’s multi-chain deployment (including Ethereum, Solana, Base, and Avalanche) and continuous expansion into diverse scenarios such as DeFi, payments, and cross-border settlements also support its gradual market capitalization recovery.
It is worth noting that Circle and BlackRock have become staunch allies, even temporarily foregoing the issuance of their own stablecoin to support USDC. The prospectus reveals that BlackRock is a strategic partner for Circle. In a new memorandum of understanding (New MOU) signed in March 2025, it was agreed that BlackRock would be the primary partner for managing Circle’s stablecoin reserves and pledged not to issue competitive dollar payment stablecoins. Both parties agreed that Circle would entrust at least 90% of its dollar custody reserves (excluding bank deposits) to BlackRock, while BlackRock would not develop or release its own stablecoin. This agreement is valid for four years. This collaboration not only enhances USDC’s risk resilience from a liquidity management perspective but also brings trust endorsements from traditional financial markets to Circle.
On the other hand, Circle’s valuation strategy possesses growth potential. The corresponding valuation of Circle’s IPO is approximately $7.2 billion, with an issuance price range of $27 to $28 per share. Based on its estimated net profit of $155 million in 2024, the price-to-earnings ratio is around 45.61 to 47.30 times. In the current global capital environment where tech sector valuations are generally high and risk appetites are tightening, Circle’s valuation is not exaggerated within the crypto industry and can even be considered rational pricing with considerable attractiveness. For context, Coinbase’s price-to-earnings ratio was once as high as 300 times during its early listing.
More importantly, Circle is seizing the window period of the GENIUS act. The timing for Circle’s IPO choice is not coincidental, but rather a precise gamble on the U.S. regulatory cycle. With the GENIUS act for U.S. stablecoin legislation making critical progress and setting a clear regulatory framework for dollar stablecoins, it means that stablecoin issuers will enter a new phase of “licensed operation.” In other words, the GENIUS act represents a combined bonus of regulatory arbitrage and market reevaluation for Circle, allowing it to complete compliance endorsements ahead of the act’s formal implementation and win recognition from investors and policymakers through its Nasdaq listing.
However, despite Circle’s impressive revenue growth, its profit structure exhibits significant vulnerability. PANews previously reported that first, Circle’s income currently relies on U.S. Treasury yields, which are essentially cyclical bonuses. If the Federal Reserve enters a rate-cutting phase, Circle’s reserve income capacity will face systematic decline.
Secondly, Circle’s profit margins are structurally squeezed by multiple partners. According to the prospectus, Coinbase, as its core partner, is entitled to receive up to 50% of the profits from USDC reserve income. In 2024, Circle is expected to pay Coinbase as much as $900 million in profit-sharing, accounting for a significant portion of annual revenue. Additionally, Circle’s collaboration with Binance has revealed high incentive costs; in November 2024, Circle paid Binance a one-time advance payment of $60.25 million and promised to distribute monthly incentives based on its USDC custody balance over the next two years, provided Binance holds no less than $1.5 billion in USDC. This strategy of relying on leading platforms to gain market share may boost market capitalization but significantly compresses Circle’s actual profit margins.
In summary, Circle’s IPO application not only serves as a phased validation of its business model but also reflects its keen insights into the regulatory environment and financial cycles. However, whether Circle can truly fulfill the expectations of being the “first stock of stablecoin” hinges on how it navigates the increasingly complex regulatory framework and fluctuations in financial cycles, finds the best path to balance innovation and compliance, and continues to optimize its profit structure while steadily advancing its global expansion.
This article is collaboratively reproduced from: PANews