Circle Going Public On June 4: What Is The Future Of CRCL?

Forbes

2 days ago

Representation of cryptocurrency and Circle logo displayed on a screen in the background are seen in ... More this illustration photo taken in Krakow, Poland on June 10, 2022. (Photo by Jakub Porzycki/NurPhoto via Getty Images)
One of the most anticipated events in crypto business this year is set for Wednesday. Circle, the company behind USDC—the world's second-largest stablecoin—is going public on the New York Stock Exchange. It will offer 32 million Class A shares at a range of $27-28 under the ticker CRCL, aiming for a $7.2 billion valuation.
Circle may seem like an easy bet: issue stablecoins, invest the reserves in Treasuries, and earn risk-free yield while users essentially lend their dollars interest-free. But behind this seemingly simple model lies a more complex and vulnerable business.
The future of interest rates remains uncertain, margins are split, and partnerships are costly. In a winner-takes-most market, Circle must outpace the impact of potentially falling rates by capturing a larger share of the stablecoin market—or simply by growing with it. Additionally, the firm's long-term success may also depend on its ability to diversify and build synergy across its products.
Stablecoins have quietly become the backbone of crypto markets—and are increasingly relevant for traditional finance. In 2024, stablecoin transaction volume reached $27.6 trillion, overtaking the combined volume of Visa and Mastercard by almost 8%.
The total stablecoin market cap now stands at $248 billion. Circle's USDC holds a 25% share—second only to Tether's USDT at 61%—and accounts for $60 billion of the total. Circle's EURC leads among euro-backed stablecoins with a $224 million market cap.
USD-pegged stablecoin supply. Source: DefiLlama
Where Circle stands out is in regulatory compliance. In the U.S., USDC has positioned itself as a compliant bridge between the crypto ecosystem and traditional finance. In the EU, the implementation of MiCA—and the resulting delisting of non-compliant stablecoins like USDT from major regulated exchanges—has paved the way for USDC to become the region's leading stablecoin.
Citi's recent report estimates that the stablecoin market could reach a size of $1.6 trillion by 2030 in its base case. Circle, with its compliance-first approach, is well positioned to benefit.
Circle's main revenue stream — 99% of it — comes from investing stablecoin reserves, primarily in short-term U.S. Treasuries. In 2024, this model proved highly lucrative, generating roughly $1.6 billion in interest income.
However, that reliance also exposes a risk of over-dependence on interest rates. As Todd H. Baker, a senior fellow at Columbia University, wrote in the Financial Times,
Another concern is distribution cost. Of Circle's $1.6 billion revenue, over $1 billion went to 'distribution, transaction, and other costs,' according to the company's S-1 filing. The bulk of that went to Coinbase—Circle's former USDC co-manager and now a key partner.
Circle consolidated statements of operations, Circle S-1 filing. Source: SEC
After dissolving the Centre Consortium in 2023, Circle took full control of USDC in exchange for a new revenue-sharing agreement. Under this deal, Coinbase receives 50% of the residual yield from USDC reserves and 100% of the interest generated by USDC balances held on its platform. In return, Coinbase pledged to 'support USDC' and 'help drive long-term success of the stablecoin ecosystem.'
As per Coinbase's 2024 report, the agreement runs for an initial term of three years. After that, Coinbase and Circle will 'discuss in good faith whether any modifications to the Circle Agreement are warranted.' If no new terms are agreed upon, the deal automatically renews for another three years—unless either side fails to meet its obligations.
With most of its revenue linked to interest rates and a significant share going to Coinbase, Circle's long-term prospects could increasingly depend on its ability to diversify. And the diversification effort seems to be underway.
Beyond USDC and EURC stablecoins, Circle offers:
While revenues from CPN and USYC weren't included in the S-1 (both too recent), they could effectively diversify Circle's revenue streams.
The CPN in particular could evolve into a blockchain-native alternative to SWIFT—one that's programmable, compliance-aware, and built for 24/7 financial infrastructure. It's a compelling bet in a payments market estimated at around $2 trillion annually, as per BCG.
USYC, meanwhile, enters the booming market of yield-bearing stablecoins and tokenized treasuries. Assets in such products surged 490% in 2024—from $1.4 billion to $8.25 billion—and now approach $10 billion, according to Stablewatch. In the segment led by BlackRock-backed Ethena's sUSDe and Sky's (formerly MakerDAO) sUSDS and sDAI, USYC is still a minor player, holding 4% of the market.
Yield-bearing stablecoins (market cap over $40M). Source: Stablewatch
Investors appear to think so. According to Bloomberg, Circle's IPO was already significantly oversubscribed by May 28. Today, the company responded by increasing its valuation target from previously announced $5.65 billion to $7.2 billion.
The investors might be onto something. Stablecoins are becoming the de facto digital dollars—especially in a U.S. environment increasingly hostile to CBDCs. Their addressable market spans global remittances, institutional payments, and DeFi integrations. The infrastructure and regulatory positioning that Circle has built could give it a head start, even as traditional giants like JPMorgan, Wells Fargo, and Citi intend to conceive their own stablecoin.
As Benjamin Billarant, founder of Balthazar Capital—an asset management firm with strong exposure to crypto-related equities—commented,
Indeed, the bipartisan GENIUS Act—America's most comprehensive stablecoin bill yet—passed the Senate on May 21 and now heads to the House. Following the vote, President Trump's Crypto Czar David Sacks said that the GENIUS Act will "pass with significant bipartisan support." The timing couldn't be better for Circle's IPO indeed.
All in all, Circle isn't just a bet on interest rates—it's a bet on the future of regulated crypto finance. With stablecoin adoption growing and a compliance-first model, Circle could become a key pillar of tomorrow's payment system. For $CRCL holders, the challenge will be navigating the gradual shift from "easy" rate-driven gains to a more demanding reliance on product-driven revenue. Whether Circle can evolve in time is the question the IPO asks—and the market will soon answer.