Circle IPO sends shockwaves through Wall Street with 675% jump, investors call it a rocket ride

Time of India

15 hours ago

Circle's IPO experienced a remarkable 675% surge, sparking renewed debate about the "IPO pop." Setting its initial price at $31, the stock soared to $240.38, fueled by stablecoin legislation and the volatile crypto market. While some criticize the IPO system, others argue that such pops benefit companies through employee morale and investor confidence.
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Circle's IPO rallied to a 675 percent jump, sending shockwaves across Wall Street and reviving the IPO pop connotations.Circle recently had its Initial Public Offering, that's when a company starts selling its shares to the public. There's a lot of hype and debate again about the idea of the 'IPO pop,' thanks to Circle's IPO. For years, there weren't many IPOs happening, but now Circle's big jump in price has got people talking, as per the report by Axios.Circle set its IPO price at $31 per share, and by the end of Friday, the stock was worth $240.38. That's a 675% increase from the IPO price to the Friday price. On the first day itself, the price went up 168%, this was a record jump for a company that raised at least $1 billion in its IPO.Originally, Circle planned to price its shares between $26 and $28, but later increased the range. Critics say the IPO system is broken, they believe it's made more to help bankers and their favorite clients, instead of helping the company make the most money, according to the report by Axios.People think with today's tech, the system should be smarter and more fair. Also, General Catalyst, a venture capital firm, and its investors could have made $110 million more. But others defend the current system, saying a 'pop' helps companies in other ways, it makes employees happy, attracts new talent, and makes long-term investors more confident, as stated by Axios.These defenders say trying to get the perfect price doesn't always work well in real life. However, Circle might be different from other companies, it's in the crypto industry, which is very up and down and driven by emotions. Also, right after the IPO, the U.S. Senate passed stablecoin legislation, which helped Circle even more.Before that law passed, Circle's shares were at around $150, so the price went up again because of that news. Even though the Senate passed it, the law still needs to pass the House before it's final. For comparison: Other recent IPOs didn't do as well, for example, Chime, a neobank, jumped 59% on day one, but now it's only up 9%, according to the report by Axios.Another company, Omada, which does digital health, is now trading below its IPO price. Right now, the IPO schedule is pretty empty, and bankers seem more ready for summer vacation than more IPOs. But people expect IPO price talk to come back after Labor Day, as per reports.Circle's stock jumped from $31 to $240.38, a 675% increase.Critics say it helps bankers and top clients more than the company itself.