The IPO of the stablecoin issuer USDC — the company Circle — can undoubtedly be called one of the most significant events in global finance. On the first day of trading, the company's shares soared by almost 170%. Why did analysts call this event a new chapter in the history of the stock market, and should investors consider adding Circle's shares to their portfolios? The debut trading session on June 5 at the New York Stock Exchange saw Circle (traded under the ticker CRCL) and some of its shareholders raise nearly $1.1 billion, Bloomberg reported.
Within minutes of the market opening, CRCL surged in price by more than three times and experienced such volatility that the New York Stock Exchange had to halt trading multiple times.
Overall, on the first day of listing, the value of CRCL increased from $31 to $82 — by 168%. Last Friday, CRCL reached a new high of $123.51, coming within a few cents of quadrupling its IPO price.
During the IPO, Circle sold 14.8 million shares, and another 19.2 million shares were sold by its shareholders, including the company's chairman Jeremy Allaire. By the time the application acceptance closed on May 3, the demand for shares exceeded the available number by 25 times, Bloomberg sources reported.
Today, the company's market capitalization is estimated at $21.6 billion. Although other American tech giants are valued higher than Circle, none of them burst onto the stock exchange with such astonishing success. To prove this, the publication decrypt cites several examples of the loudest and most anticipated IPOs of recent years.
The company Meta, formerly known as Facebook, conducted its IPO at a price of $38 in 2012. After the first day of trading, its shares remained at $38.23, which disappointed investors. Although this price allowed Facebook to be valued at a colossal sum of $104 billion.
Uber also failed to meet investor expectations after its debut on Wall Street in 2019. The disruptive ride-hailing startup valued its shares at $45, but on the first day of trading, they fell by 8% and closed below $42. At that time, the company's valuation was $69.7 billion.
A similar situation was observed in fintech. In July 2021, Robinhood launched on the stock exchange with a share price of $38, but on its first day of trading, its shares under the ticker HOOD finished down by more than 8% — to $34.82, with a market capitalization of $32 billion.
But even when the shares of large tech companies exceeded analysts' expectations, it was by a smaller margin than Circle. In 2020, Airbnb's shares more than doubled the IPO price on the opening day, jumping from $68 to $144.71 by the close. This jump of 112% was announced as a fairy tale success story at the time. So what is Circle, and what asset are investors really investing in when buying CRCL?
What is the company Circle
Strengths
Founded in 2013, Circle has become a prominent player in the cryptocurrency market — primarily as the issuer of USD Coin (USDC).
Stablecoins have become the backbone of cryptocurrency markets and are increasingly penetrating the realm of traditional finance. In 2024, the transaction volume of stablecoins reached $27.6 trillion, surpassing the combined volume of Visa and Mastercard by nearly 8%.
The total market capitalization of stablecoins is now $248 billion. USDC Circle holds a 25% share — second only to USDT Tether with 61% — amounting to $60 billion of the total. EURC Circle leads among euro-backed stablecoins, with a market capitalization of $224 million. Such statistics are provided by Forbes.
