chamath-1
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What I Read This Week…
Circle went public this week in one of the most successful IPOs in recent memory, with shares 25× oversubscribed and the company raising $1 billion, more than double expectations.
Shares priced at $31 closed their first day of trading on the NYSE at $83, giving the company a market capitalization near $19 billion, and then rose again to over $107 the next day.
Circle is best known as the issuer of USDC, a dollar-backed stablecoin widely used for digital payments and on-chain financial infrastructure.
For years, Circle has operated ahead of U.S. regulation, building the underlying architecture for stablecoin issuance, compliance, and settlement in advance of regulatory and legal clarity.
Regulatory and legal clarity may be formalized soon through the GENIUS Act, a bipartisan bill advancing in the House Financial Services Committee that would establish a comprehensive regulatory framework for stablecoins.
In a market where the company that builds the most efficient infrastructure with cost-plus pricing (and a thin margin on top) wins, Circle’s head start and the resources raised through its IPO could give it an advantage over competitors.
The IPO’s success also suggests that public markets are open to new listings, especially from crypto companies, and reinforces that regulatory clarity may be the decisive factor in opening both private and public markets.
Circle went public this week in one of the most successful IPOs in recent memory, with shares 25× oversubscribed and the company raising $1 billion, more than double expectations.
Shares priced at $31 closed their first day of trading on the NYSE at $83, giving the company a market capitalization near $19 billion, and then rose again to over $107 the next day.
Circle is best known as the issuer of USDC, a dollar-backed stablecoin widely used for digital payments and on-chain financial infrastructure.
For years, Circle has operated ahead of U.S. regulation, building the underlying architecture for stablecoin issuance, compliance, and settlement in advance of regulatory and legal clarity.
Regulatory and legal clarity may be formalized soon through the GENIUS Act, a bipartisan bill advancing in the House Financial Services Committee that would establish a comprehensive regulatory framework for stablecoins.
In a market where the company that builds the most efficient infrastructure with cost-plus pricing (and a thin margin on top) wins, Circle’s head start and the resources raised through its IPO could give it an advantage over competitors.
The IPO’s success also suggests that public markets are open to new listings, especially from crypto companies, and reinforces that regulatory clarity may be the decisive factor in opening both private and public markets.
It would be genius for Ripple or Coinbase to buy Circle.**
It looks like Circle’s IPO is 25x oversubscribed, valuing the company at around $7b. If someone can buy it for even $12-13b, that’s a steal, imo, for what this business could be worth in 20 years.
Circle has built the entire market structure for stablecoins well before it will formally exist in the U.S. (i.e. ahead of the GENIUS bill).
My prediction: Stripe, Square, Ripple, Coinbase - they’re all going to end up competing with each other for stablecoin dominance, which is really good for end businesses and consumers, and probably really bad for terminal margins.
The company that builds the most efficient infrastructure and sells it for cheapest: cost-plus (with a thin margin on top) will probably take this market.
**Note that there are no official/confirmed reports of Coinbase pursuing an acquisition of Circle, but there is a bunch of rumors in the rumor mill that they are in acquisition discussions.
It looks like Circle’s IPO is 25x oversubscribed, valuing the company at around $7b. If someone can buy it for even $12-13b, that’s a steal, imo, for what this business could be worth in 20 years.
Circle has built the entire market structure for stablecoins well before it will formally exist in the U.S. (i.e. ahead of the GENIUS bill).
My prediction: Stripe, Square, Ripple, Coinbase - they’re all going to end up competing with each other for stablecoin dominance, which is really good for end businesses and consumers, and probably really bad for terminal margins.
The company that builds the most efficient infrastructure and sells it for cheapest: cost-plus (with a thin margin on top) will probably take this market.
**Note that there are no official/confirmed reports of Coinbase pursuing an acquisition of Circle, but there is a bunch of rumors in the rumor mill that they are in acquisition discussions.
It would be genius for Ripple or Coinbase to buy Circle, and Circle might be trying to IPO to get ahead of this.**
It looks like Circle’s IPO is 25x oversubscribed, valuing the company at around $7b. If someone can buy it for even $12-13b, that’s a steal for what this business represents in 20 years.
Circle built the market structure before it formally existed in the U.S. (i.e. ahead of the GENIUS bill).
My prediction: Stripe, Square, Ripple, Coinbase, Robinhood - they’re all going to end up competing with each other for consumers, which is really good for the consumer, and really bad for margins.
The company that can build the most efficient infrastructure and sell it for cost-plus (with a thin margin on top) will take this market.
**Note that there are no official/confirmed reports of Coinbase pursuing an acquisition of Circle, but there is a bunch of rumors in the rumor mill that they are in acquisition discussions.
It looks like Circle’s IPO is 25x oversubscribed, valuing the company at around $7b. If someone can buy it for even $12-13b, that’s a steal for what this business represents in 20 years.
Circle built the market structure before it formally existed in the U.S. (i.e. ahead of the GENIUS bill).
My prediction: Stripe, Square, Ripple, Coinbase, Robinhood - they’re all going to end up competing with each other for consumers, which is really good for the consumer, and really bad for margins.
The company that can build the most efficient infrastructure and sell it for cost-plus (with a thin margin on top) will take this market.
**Note that there are no official/confirmed reports of Coinbase pursuing an acquisition of Circle, but there is a bunch of rumors in the rumor mill that they are in acquisition discussions.
The data is damning. If you aren’t a top quartile VC fund, you’re destroying money for your LPs.
Moreover, the ability to be a consistently top quartile fund is unpredictable. I know so many people who accidentally stepped in shit in one fund or one company and have ZERO consistency across time or funds. Their numbers betray their narrative. Making money is hard and very very very few really know how to do it over decades.
Now I shall dunk on my erstwhile competitors:
Every fund I ran except Fund 1** (so 4 of 5) are currently top quartile on Net DPI to LPs per Cambridge Index, the gold standard in measurement. This was across varying fund sizes, varying strategies and, most importantly, varying teams.
**Fund I has a look through ownership to Bitcoin which should propel it into top quartile DPI at some point when I mark to market at which point I will be 5 for 5, or a perfect 100% batting average in creating too quartile returns over time, size, strategy and team.
No crying in the casino! Only excuses.
Moreover, the ability to be a consistently top quartile fund is unpredictable. I know so many people who accidentally stepped in shit in one fund or one company and have ZERO consistency across time or funds. Their numbers betray their narrative. Making money is hard and very very very few really know how to do it over decades.
Now I shall dunk on my erstwhile competitors:
Every fund I ran except Fund 1** (so 4 of 5) are currently top quartile on Net DPI to LPs per Cambridge Index, the gold standard in measurement. This was across varying fund sizes, varying strategies and, most importantly, varying teams.
**Fund I has a look through ownership to Bitcoin which should propel it into top quartile DPI at some point when I mark to market at which point I will be 5 for 5, or a perfect 100% batting average in creating too quartile returns over time, size, strategy and team.
No crying in the casino! Only excuses.
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