Circle Internet IPO: Stablecoin giant fetches $18 billion valuation, shares more than triple by 235% in NYSE debut

Mint

2 days ago

Stablecoin issuer Circle Internet's shares more than tripled in their debut on the New York Stock Exchange on Thursday, a move expected to boost an IPO market that has struggled to regain momentum.
The New York-based company's stock opened for trading at $69 apiece, valuing the stablecoin issuer at nearly $18 billion, on a fully-diluted basis.
The stock rose as much as $103.75 and was halted multiple times for volatility amid frenetic trading.
The successful flotation is likely to encourage other crypto IPO hopefuls eyeing public markets. Surging interest in digital assets amid rising token prices and supportive regulatory developments is expected to spur more listings from the industry.
"The more crypto companies that go public, the easier it will be for future crypto companies," said Matt Kennedy, senior strategist at Renaissance Capital, a provider of IPO-focused research and ETFs.
"The number of deals is important, but so is the variety - having publicly-traded companies across the crypto ecosystem."
Circle and some existing investors raised $1.05 billion in an upsized IPO by selling 34 million shares at $31 apiece, above the marketed range of $27 to $28 each.
"This morning we had Circle going public in what I can only characterize as a blowout deal," said Lynn Martin, president at NYSE Group.
The outlook for the digital asset industry has also brightened with the Trump administration adopting a lighter regulatory touch and moving to establish a crypto-friendly environment.
In recent months, a growing number of companies have also added cryptocurrencies to their balance sheets to capitalize on rising token prices.
The crypto market is changing and evolving significantly. As the rules continue to be refined and clarified, there will be a flood of crypto and crypto-related IPOs, said Ross Carmel, partner at law firm Sichenzia Ross Ference Carmel.
Circle's flotation is the biggest crypto listing since Coinbase's 2021 debut and the first major IPO by a stablecoin issuer. It had earlier attempted to go public through a $9 billion blank-check deal, but the deal fell apart in 2022.
Circle's IPO is also a landmark moment for the stablecoin market, which has been a hot topic since the Trump administration took office.
The passage of the pending stablecoin bill could further accelerate the adoption of the digital tokens and make them more mainstream.
Apart from being used to trade cryptocurrencies, stablecoins are also increasingly used as a form of digital payment.
Wall Street expects stablecoins to become one of the biggest themes within finance in the coming years and the next multi-trillion-dollar market opportunity.
Founded in 2013 by Jeremy Allaire and Sean Neville, Circle issues the dollar-denominated USDC, the world's second-largest stablecoin by market cap after Tether. Besides USDC, Circle also issues the euro-denominated stablecoin EURC.
Allaire, 53, has led Circle since its inception. He previously served as the co-founder and CEO of streaming technology company Brightcove.
Circle Internet Group Inc. shares surged as much as 235% after the company and some of its shareholders raised nearly $1.1 billion in an initial public offering that was upsized twice amid strong demand.
Shares of the stablecoin issuer climbed to as much as $103.75 apiece on Thursday, versus an IPO price of $31 each. The stock was trading at $84.92 each as of 12:54 p.m. in New York. just before it was halted for volatility.
The offering of 34 million shares by Circle and backers including co-founder and Chief Executive Officer Jeremy Allaire was increased from 32 million shares, and had been marketed at $27 to $28 each.
The trading gives Circle a market value of $18.9 billion based on the outstanding shares listed in its filings. Accounting for employee stock options, restricted share units and warrants, the company would have a fully diluted valuation of about $22.5 billion.
The offering comes as stablecoins, digital tokens that are often pegged to the dollar or another currency and backed by reserves, are poised to be regulated by legislation currently in front of Congress, a development that may lead to larger institutional adoption. It may also draw in competitors, with some of Wall Street's largest banks jointly exploring whether to issue their own stablecoin, the Wall Street Journal reported last month.
Circle's USDC had about 29% of the market as of the end of March, according to the filing citing data from CoinMarketCap. There is about $61 billion worth of the token in circulation as of May 29, its website shows.
Circle sold 14.8 million shares in the IPO, while the selling shareholders divested 19.2 million shares, the statement showed. The upsized deal fielded demand for more than 25 times the number of shares available as of when orders stopped being taken on Tuesday, people familiar with the matter have said.
The target for Circle's IPO was increased on Monday from the initial 24 million shares within a price range of $24 to $26 each, its earlier filings showed.
ARK Investment Management, the technology-focused firm founded by Cathie Wood, is interested in buying as much as $150 million of shares in Circle's IPO, according to the filing. BlackRock Inc. plans to acquire about 10% of the IPO shares, people familiar with the matter have said.
BlackRock manages a government money market fund on Circle's behalf that holds 90% of the reserves backing its USDC stablecoin, according to the filing. The Circle Reserve Fund has a balance of $53.3 billion as of May 29, according to the company's website.
Circle was valued at $7.7 billion after a funding round in 2022, according to data provider PitchBook. The company had filed confidentially early in 2024 for a listing, more than a year after scrapping a bid to go public via a merger with a blank-check company. That deal would have valued the company at $9 billion.
Allaire held 23.1% of the voting power before the offering, followed by a General Catalyst fund with 8.9% and affiliates of IDG Capital with 8.8%, the filings showed.
The IPO was led by JPMorgan Chase & Co., Citigroup Inc. and Goldman Sachs Group Inc. The shares trade on the New York Stock Exchange under the symbol CRCL.