In a surprising turn of events, Circle the company behind the USD Coin (USDC) stablecoin has declined a multibillion-dollar acquisition proposal from Ripple. Despite the lucrative offer, reportedly between $4–$5 billion, Circle walked away from the deal. Here’s why.

1. The Offer Didn’t Match Circle’s Valuation

While a $5 billion deal may seem enticing on paper, it fell short of Circle’s self-assessed value. The company had previously aimed for a $9 billion valuation during its planned SPAC merger, which was ultimately scrapped. Even so, Circle's fundamentals have continued to strengthen.

  • USDC’s market cap currently stands at over $61.5 billion.

  • Annualized revenue for Circle has hit $1.68 billion.

When comparing Ripple’s offer to those numbers, the valuation amounted to roughly 3x Circle’s yearly revenue considered too low for a fast-growing fintech firm leading in stablecoin adoption.

2. Circle is Prioritizing its IPO and Long-Term Vision

Rather than being acquired, Circle is setting its sights on going public. In April 2024, the firm filed to list its shares on the New York Stock Exchange (NYSE), signaling confidence in its standalone growth strategy.

This IPO move isn't just about raising capital it's about:

  • Enhancing regulatory transparency

  • Building institutional trust

  • Strengthening brand credibility

Acquisition by Ripple especially amid Ripple’s ongoing legal battle with the SEC could potentially undermine this long-term trajectory.

3. Strategic Independence is Non-Negotiable

Circle’s decision also reflects a desire to remain independent. USDC’s strength lies in its interoperability operating across multiple blockchains and partnering with a wide network of financial institutions.

Becoming a Ripple subsidiary could:

  • Raise conflict-of-interest concerns

  • Limit integration opportunities with other partners

  • Jeopardize Circle’s neutrality in the ecosystem

Maintaining full control over its roadmap, compliance standards, and global partnerships remains critical for Circle’s success.

4. Reputation and Regulatory Integrity Come First

Circle has worked hard to position itself as one of the most regulatory-compliant players in the crypto space with transparent reserves, audited financials, and a cooperative stance with U.S. regulators.

Ripple, on the other hand, is still entangled in a high-profile legal dispute with the SEC. Joining forces with Ripple could:

  • Create uncertainty around USDC's regulatory future

  • Damage Circle’s credibility with banks, institutional clients, and government bodies

  • Send the wrong message to global regulators

Simply put, the reputational risk outweighed the financial upside.

Conclusion

Circle’s rejection of Ripple’s $5 billion offer isn’t about money it’s about mission. The company is doubling down on independence, regulatory alignment, and long-term value creation through its upcoming IPO. For a firm that plays a central role in global stablecoin infrastructure, maintaining trust and strategic flexibility appears to be worth far more than a hefty check.

Disclaimer:

This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always conduct your own research (DYOR) and consult with a financial advisor before making investment decisions.