Latest news with #Circle
Yahoo
7 hours ago
- Business
- Yahoo
An Extremely Profitable Business Plans to Go Public. What Investors Need to Know.
This company's revenue is growing at a high-double-digit percentage rate while commanding a compelling profit margin. This interesting cryptocurrency company will be worth watching as it makes its market debut. 10 stocks we like better than USDC › On May 27, Circle Internet Group updated its filings to become a publicly traded company. It's possible that investors haven't heard of Circle. But cryptocurrency enthusiasts are likely quite familiar with Circle's stablecoin USD Coin (CRYPTO: USDC), the second-largest stablecoin by market cap. A stablecoin is an interesting class of cryptocurrency. The price of Bitcoin (CRYPTO: BTC), for example, recently increase to an all-time high because its price changes relative to the U.S. dollar. It has a mechanism that controls the circulating supply of Bitcoins. And if demand exceeds this supply, then the price goes up. Stablecoins such as USDC don't work that way. Those wanting to use stablecoins can go to a cryptocurrency exchange such as Coinbase (NASDAQ: COIN). Once there, they deposit real dollars and exchange them for stablecoins. For every dollar they put in the system, a corresponding stablecoin is issued. This way, the price of each stablecoin should always be $1, rather than fluctuating like Bitcoin. Moreover, users should be able to exchange stablecoins back for dollars if and when they choose. Circle is a stablecoin issuer, and this business model can actually be extremely profitable. The costs to operating a stablecoin system are relatively low. Meanwhile, the stablecoin issuer needs to keep reserves in case users redeem their coins. These reserves turn into stable interest and investment income. The largest stablecoin entity is Tether, with a market value of more than $150 billion. It's not publicly traded, but it still reports financials from time to time. In the first quarter of 2025, it reported an operating profit of $1 billion, it had excess reserves of $5.6 billion, and its management is busily investing in other business ventures such as renewable energy. In other words, Tether seems to be a cash cow business with low need to reinvest in the business, freeing it to invest in other opportunities. This favorable stablecoin business model is why investors should keep an eye on Circle. Let's start with some concrete numbers. In the first quarter of 2025, Circle's total revenue rose 58% year over year to $579 million. And the company had operating income of $93 million, which was up 78%. That's good growth. And the table shows progress during the past three years. 2022 2023 2024 Revenue* $772 million $1.5 billion $1.7 billion Gross margin 60% 50% 39% Operating income ($38) million $270 million $167 million Data source: Circle's filings. Table by author. *Revenue from continuing operations. Circle had a Q1 operating margin of 16%, which is good. But the one thing apparent from the table is that the company has traded profitability for growth. Growth skyrocketed in 2023, whereas its gross margin took a significant step back. What gives? As it turns out, cryptocurrency exchange Coinbase helped launch USDC originally, so it's long had a vested interest. The company perceived that the stablecoin needed help, and so it reworked its partnership with Circle in 2023. Coinbase actively began pushing for USDC's growth while taking a larger cut of the profits. In other words, Circle would likely be far more profitable if it didn't partner with Coinbase. But otherwise, it might not be as big as it is today. It's something to be aware of, but the partnership is probably a net benefit. At the risk of oversimplifying things, high-growth, profitable businesses often make good investments. For this reason, I believe investors should watch Circle Internet Group stock once it goes public. But there are some risks to consider as well. First and foremost, Circle profits from user deposits. Although this is easy money, a lot of it has to do with interest rates, which are outside the company's control. Supposing rates trended lower, it would lower Circle's interest income. It's theoretically possible to see adoption go up and interest income go down. Second, as of this writing, Tether's market cap is $153 billion, according to CoinMarketCap, whereas USDC is only $61 billion. This suggests stablecoin users prefer Tether. In fact, without Coinbase's big push in 2023, it's debatable how big USDC would be. So it's fair to question the sustainability of its growth from here. Finally, legislation regarding stablecoins is always a concern. The current political atmosphere in Washington appears favorable to cryptocurrency. But the market could benefit from legislative clarity, and there's no guarantee which way things could go. However, taking this all into consideration, I believe that Circle stock could be a good long-term investment. This assumes that cryptocurrency adoption continues, Coinbase stays in its corner, and interest rates don't plunge overnight, which I believe are reasonable assumptions. For these reasons, I'll be watching Circle as it goes public. Before you buy stock in USDC, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and USDC wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $638,985!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $853,108!* Now, it's worth noting Stock Advisor's total average return is 978% — a market-crushing outperformance compared to 171% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Jon Quast has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Coinbase Global. The Motley Fool has a disclosure policy. An Extremely Profitable Business Plans to Go Public. What Investors Need to Know. was originally published by The Motley Fool
Yahoo
a day ago
- Business
- Yahoo
XLM Price Prediction - What could affect XLM's future price?
Stellar (XLM) price prediction remains uncertain as bullish technical setups and growing institutional adoption are countered by bearish momentum and broader macroeconomic headwinds. - Bullish catalysts: Falling wedge breakout ($0.60–$0.86 targets), Soroban smart contracts, Visa/Circle partnerships. - Bearish risks: Death cross formation, declining volume, Bitcoin dominance stifling altcoins. - Macro wildcards: Regulatory clarity on stablecoins, altcoin season timing. Soroban Smart Contracts: Launched in 2024, Stellar's EVM-compatible platform has driven a 7x surge in on-chain activity, with $54M TVL and $353M stablecoin market cap. A $100M developer fund aims to expand DeFi and RWA tokenization. Institutional Adoption: Large wallets (1–10M XLM) grew 37% in Q2 2025, per on-chain data. Partnerships with Visa (cross-border payments) and Franklin Templeton (tokenized assets) signal enterprise traction. Tokenomics: Fixed supply of 50B XLM post-2019 burn, with 62% already circulating. Scarcity could amplify price moves if demand surges. Bullish Patterns: Weekly chart shows a confirmed falling wedge breakout (target: $0.60–$0.86). The 200-day SMA ($0.333) and Fibonacci 61.8% level ($0.284) are key resistance. Bearish Signals: Death cross (9-day/21-day SMA) and RSI 45.6 suggest short-term weakness. A drop below $0.265 support could trigger panic selling. Altcoin Season Lag: Bitcoin dominance at 63% (as of May 2025) limits capital rotation into XLM. A shift to 'Altcoin Season' (CMC index <50) is critical for upside. Regulatory Tailwinds: Stellar's ISO 20022 compliance and focus on MiCA-ready stablecoins position it favorably in Europe's regulated finance landscape. XLM's price hinges on whether institutional adoption and technical breakouts can override bearish market structure. The $0.265–$0.284 zone is make-or-break short-term. Will Soroban's DeFi growth outpace Bitcoin's dominance in Q3 2025? XLM price prediction is mixed, as bullish technical patterns and rising institutional adoption are tempered by bearish indicators, including a recent death cross. - Bullish technicals: Falling wedge breakout, ascending channel, and $0.28 support. - Bearish signals: Death cross, declining volume, and selling pressure. - Ecosystem growth: Visa integration, RWA tokenization, and institutional accumulation. Traders are divided:- Bullish: Breakout from a falling wedge (May 18) and ascending channel suggest targets up to $0.86. The $0.28 support level is seen as critical for a rebound.- Bearish: A death cross emerged on May 28, with trading volume dropping 62.7% and Open Interest down 6.6%, signaling weakening momentum. Institutional sentiment leans positive, with wallets holding 1–10M XLM up 37% in 90 days. Price projections:- 2030 forecasts range wildly: $0.36 (Kraken) to $14.02 (Telegaon). Most analysts peg $1.29–$2.92 as realistic. Ecosystem developments:- Visa expanded support for Stellar-based stablecoin payments (May 29), boosting real-world utility.- Partnerships with Franklin Templeton, IBM, and Circle for RWA tokenization and cross-border settlements. Technical debates:- Stellar's Proof-of-Agreement (vs. PoS) is praised for accountability but criticized for slower decentralization. Ali Martinez: Highlights $0.28 as make-or-break support; breakout above $0.276 could trigger a rally. JAVONMARKS: Sees a long-term inverse head-and-shoulders pattern targeting $1.29. Institutions: Franklin Templeton and MoneyGram use Stellar for tokenized assets and remittances, reinforcing its niche in compliant finance. Stellar's narrative hinges on balancing technical uncertainty with real-world adoption. While bearish signals dominate short-term charts, partnerships like Visa and institutional accumulation suggest latent upside. Will Stellar's focus on regulated, cross-border finance outweigh its technical headwinds? To get the latest update on Stellar, visit our XLM currency page. Content created: 30th May 2025 Disclaimer: Content generated by CMC AI. CMC AI can make mistakes, please DYOR. Not financial advice. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
- Business
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The Chime IPO: what investors should know about its $31 a share private market valuation and more
Times have changed for Chime, the once hot fintech that was valued at $25 billion in 2021. That year, the IPO market was sizzling when more than 1,000 companies went public on U.S. exchanges. Chime was widely expected to be one of those companies, but it chose to wait. Four years later, Chime's valuation appears to have fallen by more than half, while the IPO market is trying to rebound with some big names, like crypto provider Circle, looking to list. New issues have turned in some strong performances during the past month. The public offerings of online broker eToro Group, Hinge Health and MNTN, the connected TV advertising platform, each rose during their respective debuts and, more importantly, all three have remained above their IPO prices. One of the biggest tests for IPOs will come next week when Circle, the issuer of the crypto stablecoin USDC, begins trading on June 5. Circle could raise as much as $624 million at a roughly $6.7 billion valuation. The Circle IPO is multiple times oversubscribed, Bloomberg reported. Against this positive background, Chime is expected to launch its roadshow soon. It will then give more information on its pending IPO, including how many shares it will sell and at what price. The fintech will trade on the Nasdaq under the ticker CHYM. Founded in 2012, Chime offers traditional financial services, like fee-free checking and savings accounts, to lower income U.S. consumers that earn up to $100,000 a year. The startup had 8.6 million active members as of March 31, with two-thirds relying on Chime as their primary bank, according to a regulatory filing. Roughly 70% of its members use Chime to buy food, groceries, gas and utilities. As of March 31, the startup employed 1,465 workers, or 'Chimers,' spread across three offices, including one-third in San Francisco. Chime is not a bank and doesn't have a bank charter. Instead, it partners with Bancorp Bank and Stride Bank to provide its services. 'Chime definitely has a great brand for that particular cohort, the under banked,' said Dan Dolev, a senior analyst in fintech equity research at Mizuho Securities. 'They've done a great job getting the name out there.' Perhaps the biggest question hanging over Chime is its valuation. Chime has collected $2.3 billion in funding from investors, including General Atlantic, Tiger Global Management, and Sequoia Capital. In 2021, the last time Chime raised money, its shares were valued at $69.07 but that has fallen. Pricing data from Forge, an online marketplace for buying and selling shares of private firms, marked Chime at $31.50 as of May 26. Chime shares have actively traded in the private markets this year and the $31.50 is based on recent trading activity, Forge said. On Hiive, a private stock marketplace, the last accepted bid for Chime was $31 in early March, a spokesman said. There are also standing bids for Chime shares at $40 but no sellers, the spokesman said. This likely indicates that sellers are waiting for prices to move higher. Some believe it is misleading to value a company based on secondary market prices. The secondary market is considered less transparent than the public market, it is more loosely regulated and sales often involve small volumes of stocks, which may not accurately represent a company's true value. Either way, a $31 or $31.50 price for Chime indicates a drop in value of more than 50%. Chime has yet to disclose how many shares it has outstanding so the fintech's total valuation is unclear. 'Like many companies, Chime likely could have gotten a higher valuation had it gone public at the peak of the last cycle in 2021,' said Matt Kennedy, senior IPO strategist at Renaissance Capital, a provider of pre-IPO research that manages two IPO-focused ETFs (NYSE: IPO, IPOS). Chime declined to comment. The field of companies that offer services to lower income consumers has grown more crowded. Green Dot, which has targeted this segment since 2001, is currently up for sale. (Chris Britt, Chime's cofounder and CEO, previously worked at both Green Dot and Visa.) One of Chime's bigger rivals is Cash App, which targets the same group of low-income consumers. Revenue for Cash App in 2024 rose 11% to $16.2 billion, with most, about $10.1 billion, coming from Bitcoin trading. Block, formerly known as Square, owns Cash App. 'Cash App is so established that it makes it difficult to compete,' Dolev said. Mizuho's Dolev says Cash App, which has a debit card, has a more diversified revenue stream than Chime which relies on unregulated interchange—a term that describes debit card fees not subject to a federal cap. Dolev estimates that Chime makes about 1% of every dollar spent in debit card transactions on a net basis, while large banks are capped at 21 cents per transaction. For example, if a consumer uses a Chime debit card to buy $50 worth of groceries at the supermarket, the fintech makes about 50 is the first US-based neobank to go public via a traditional IPO, Renaissance Capital's Kennedy said. (Nu Holdings, of Brazil, went public in 2021 but targets Latin America.) Other neobanks waiting to launch their IPOs include Klarna, which is known more for its buy now, pay later, or BNPL, services. Klarna is reportedly delayed until late in 2025. Revolut, the London fintech, is a licensed bank in the EU and is widely anticipated to go public but has yet to set a date. Chime is unprofitable on a yearly basis with losses narrowing to $25.3 million in fiscal 2024. The company was profitable in the first quarter, reporting nearly $13 million in net income, compared to nearly $16 million in profit for the same quarter in 2024. (But it reported nearly $20 million in losses for the three months ended Dec. 31.) Revenue for Chime rose 31% to about $1.7 billion for fiscal 2024 and grew on a quarterly basis, by 32%, to $518.7 million for the three months ended March 31. A majority of its revenue comes from interchange. 'I think we would have liked to see more progress on the bottom line, the net income side, but I don't see any huge red flags,' Renaissance's Kennedy said. This story was originally featured on Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
What is a stablecoin, anyway? Circle's $6.7 billion IPO filing puts spotlight on crypto tokens pegged to the U.S. dollar
The issuer of USDC, a popular stablecoin that's pegged to the U.S. dollar, is officially launching an initial public offering. Circle Internet Group filed paperwork with the U.S. Securities and Exchange Commission on Tuesday to raise up to $624 million by offering 24 million shares to investors. Spicy AI-generated TACO memes are taking over social media because 'Trump always chickens out' Lego's first book nook is an addictively interactive diorama Forget quiet quitting: I'm using 'loud living' to redefine workplace boundaries With its IPO plans, New York-based Circle is hoping to put a lot of circles—well, zeros—behind its valuation, targeting up to $6.71 billion. Tuesday's filing has been long-awaited, as the company confidentially filed for an IPO in January 2024 after scrapping 2022 plans to go public via a merger with a special purpose acquisition company (SPAC). While more players in the crypto space have been diving into public markets in recent years, Circle's filing comes at pivotal timing amid a lot of interest in stablecoins. The company's biggest coin, USDC, is the seventh-largest cryptocurrency by market cap, according to CoinMarketCap, and second-largest stablecoin behind Tether. You may have been hearing more talk of stablecoins among investors and even the U.S. government. But what even is a stablecoin, anyway? If you're confused, read on for a complete breakdown of what you need to know. Stablecoins serve a much different role in the crypto space than the likes of Bitcoin or Ethereum, which can experience wild spikes in their prices. As the name suggests, stablecoins are intentionally stable in price because their value is pegged to an asset like the U.S. dollar. Both the Tether and USDC coins are pegged 1:1 to the U.S. dollar, meaning that for every unit of these cryptocurrencies in circulation, they're backed by $1 of cash or U.S. Treasury bonds. Their prices typically fluctuate only tiny fractions of a cent higher or lower than $1. Even amid Tuesday's IPO news, the price of USDC was essentially flat. Circle is also the issuer of EURC, which is pegged to the value of the euro. Given their price stability, stablecoins offer a valuable ballast to investors amid the volatility of crypto markets for investors. Once popular as a bridge between traditional and decentralized finance markets, there's been more interest in stablecoins as various countries around the world embrace cryptocurrencies. If you feel like you're hearing more about stablecoins lately, it's because they've been the topic of recent debate in the U.S. Senate. In February, Senator Bill Hagerty, a Republican from Tennessee, introduced the GENIUS Act, which would have classified stablecoins as securities under the jurisdiction of the SEC to establish regulatory guardrails for these coins. That Act would have brought a new layer of legitimacy to the crypto industry by bringing stablecoins into the regulated financial system. But the U.S. Senate voted earlier this month to block further advancement of the GENIUS Act, which was widely viewed as a significant setback for the industry. Once a skeptic, President Donald Trump has become a vocal proponent of cryptocurrencies, though some investors worry his support isn't helping. The $TRUMP meme coin launched just days before he returned to the office for his second term. In March, he voiced his support for legislation that provides regulatory certainty for stablecoins and has said he wants the U.S. to be the 'crypto capital' of the world. Even though stablecoins have been the topic of much debate in Washington, D.C. that's not likely to affect Circle's IPO. There's been a relative dearth of initial public offerings since an all-time record in 2021 and investors may be eager to hop aboard a new offering, particularly amid a broader market recovery. Circle has applied to list its stock on the New York Stock Exchange under the ticker symbol 'CRCL' and indicated that shares could be priced between $24 and $26. But there's no definitive timeline yet for when the stock could begin trading. This post originally appeared at to get the Fast Company newsletter:
Yahoo
2 days ago
- Business
- Yahoo
Tether, Tron Dominate Fast-Growing Stablecoin Payments Arena, Survey Shows
Tether's USDT token and the Tron blockchain network dominate the rapidly growing stablecoin payment industry, according analytics firm Artemis with help from investment firms Dragonfly and Castle Island Ventures. A report entitled 'Stablecoin Payments from the Ground Up' looked at data from 31 stablecoin payment companies, and found USDT, the largest stablecoin, accounted for 90 percent of payment transaction volume, followed by Circle's USDC, the second-largest. Tron was the preferred settlement network, hosting around 60 percent of volume, followed by Ethereum, Binance Smart Chain and Polygon. The snapshot of stablecoin payment volume taken in February added up to an annualized $72.3 billion, covering various payment types and sectors (B2B, P2P, B2C, Card, and Lending). Stablecoins, predominantly U.S. dollar-pegged digital tokens, were originally used to conveniently park money while trading cryptocurrencies. But these low-cost, instantly-settled financial instruments are now eating payments across the board, with bullish estimates on the potential size of that market coming from both crypto native firms and major banks. It's perhaps surprising that the share of Circle's USDC isn't larger, given the firm's involvement in payments and recent plans to introduce a dedicated cross-border payments network. In addition, Circle, which this week filed for an initial public offering on the New York Stock Exchange, has been taking market share from Tether in terms of issuance, so the expectation might have been a similar or pro-rata level when it comes to payments volume, said Dragonfly general partner Rob Hadick. 'For the 31 providers we got data from at least, it's clear that's not the case for the payments use case,' Hadick said in an interview. 'In fact, a higher portion of the volume, relative to the issuance, is happening with Tether, and it's happening primarily on Tron and then Ethereum. This was quite surprising to us.' This perspective is partly shaped by the fact that a lot of business-to-business uses, such as paying suppliers for global supply chains, is happening from emerging markets to the U.S. or from the U.S. to emerging markets. In some of those markets, places like Argentina or Brazil, for instance, people might be worried about things like bank failures, and Tether is seen as a trusted brand, Hadick said. Moreover, firms that use stablecoins for payments have little concern about which blockchain is being used to settle on. Tron is fast and cheap and there's over $60 billion of USDT on the chain, so it simply makes sense, he added. 'If you go to Argentina or Brazil, people don't say they want to use stablecoins, they say we use Tether,' Hadick said. 'Tether is the brand that is ubiquitous with USD access, in the same way that in the U.S. Uber is ubiquitous with taking a car that you call from your phone.' Sign in to access your portfolio
