Stablecoin issuer Circle targets US$7.2 billion valuation in upsized US IPO
[BENGALURU] Crypto firm Circle Internet said on Monday (Jun 2) it was targeting a valuation of up to US$7.2 billion on a fully diluted basis in its upsized initial public offering in the US, underscoring growing momentum in the stablecoin market.
The upsized IPO indicates strong investor appetite for crypto firms under US President Donald Trump, who has not only promised friendlier regulations for the sector, but also has several crypto projects associated with him.
New York-based stablecoin issuer Circle and some existing investors are now looking to raise up to US$896 million from 32 million shares priced between US$27 and US$28 apiece, up from their earlier offer of 24 million shares between US$24 and US$26.
Circle's US dollar-denominated USDC, the second-largest stablecoin in the world, is expected to benefit from the impending stablecoin Bill, which is expected to catalyse institutional adoption.
Stablecoins are designed to maintain a constant value, usually a 1:1 US dollar peg, and are commonly used by crypto traders to move funds between tokens.
Circle's reserve income, its primary revenue source, from interest on the Treasuries backing its USDC coin, rose 55.1 per cent to US$557.9 million in the quarter ended Mar 31.
But distribution and transaction costs for the period jumped 68.2 per cent, outpacing revenue growth for Circle, which distributes USDC primarily via its partnership with Coinbase and other third-party distributors.
JPMorgan, Citigroup and Goldman Sachs are the lead underwriters for the offering. Circle will list on the New York Stock Exchange under the symbol 'CRCL'.
Circle is poised to go public in New York later this week. REUTERS
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