Too low to sell! Ripple's $5 billion bid to acquire USDC was rejected by issuer Circle

Ripple's proposal to acquire the stablecoin USDC issuer Circle for $5 billion was rejected, as Circle chose to focus on its IPO. This event reveals the fierce competition in the stablecoin market, adding variables to the future landscape. (Background: Coinbase, Circle... several giants plan to apply for 'US banking licenses', is the era of on-chain banking coming?) (Supplementary background: Circle launched the stablecoin 'Refund Protocol', can it solve payment pain points? Quick overview of advantages and disadvantages) According to the latest report from Bloomberg, Ripple reportedly made a bid of up to $4-5 billion in an attempt to acquire Circle, the issuer of the world's second-largest stablecoin, USDC, but was rejected. According to insiders, the main reason for Circle's rejection was that they considered the offer too low. Despite the initial offer being turned down, Ripple is said to still be interested in acquiring Circle but has not yet decided whether to make a new offer. Circle's current focus is on advancing its IPO application submitted in early April 2025. A Circle spokesperson stated: We do not comment on market rumors. Due to our current quiet period with the SEC, we cannot further comment on our financial plans. Our long-term goals remain unchanged. The high valuation rejected by Circle and independent considerations Circle's rejection of Ripple's acquisition proposal involves multiple considerations. Firstly, Circle believes that the $4-5 billion offer is clearly below its market value and development potential. Historical data shows that Circle was valued at $9 billion in a failed SPAC deal in 2022 and raised funds at an $8 billion valuation in its Series F financing. Secondly, Ripple's offer may contain a large amount of illiquid Ripple company equity rather than all cash, which lacks appeal to Circle, which is preparing for an IPO and hopes to maintain financial autonomy. Furthermore, Circle tends to maintain independent development and market leadership, merging with a competitor like Ripple, which has its own stablecoin RLUSD, would mean absorbing a competitor and potentially losing regulatory and market advantages, which is inconsistent with its strategic goals. Currently, Circle seems confident in advancing its IPO process, believing that an IPO can bring a better valuation and strategic position than an acquisition. At the same time, USDC has established a good relationship with regulators and has strong partners and market trust, giving up these advantages (especially in exchange for equity in a company launching competing products) is unlikely to align with Circle's strategic goals. Circle's financial performance According to its financial performance in 2024, Circle's revenue is approximately $1.67 - $1.68 billion, with a year-on-year growth of 16%, primarily from USDC reserve earnings, and a net profit of approximately $155.6 - $157 million, a year-on-year decline of 41-42%, partly due to distribution costs to Coinbase for USDC ($908 million). The S-1 document shows that over 99% of Circle's revenue comes from interest-bearing assets supporting USDC, such as U.S. Treasury bonds. JPMorgan and Citigroup serve as lead underwriters. Circle also disclosed holding a small amount of crypto assets and received approval from Japanese regulators to issue USDC in March 2025. As of April 2025, USDC has a market capitalization of approximately $61.5 billion, making it the second-largest stablecoin. Ripple's stablecoin ambitions: Challenges and opportunities of RLUSD Despite the failed acquisition of Circle, Ripple still shows a strong intention to expand in the stablecoin market. Recently, it acquired broker Hidden Road for $1.25 billion, demonstrating its aggressive market acquisition strategy. On the other hand, Ripple launched its own dollar-pegged stablecoin RLUSD in December 2024. As of early May 2025, RLUSD has a market capitalization of approximately $316.9 million, which still has a significant gap compared to USDC's $61.7 billion market cap. However, RLUSD minted over $100 million in April 2025 and has integrated with payment providers like B Forex and Send, focusing on enhancing cross-border payment efficiency. Whether RLUSD can leverage its payment efficiency and regulatory advantages to gain ground remains uncertain. Related reports Comprehensive interpretation of the $60 billion USDC behind Circle's revenue composition and symbiotic relationship with exchanges How will Circle's listing impact the stablecoin market? Comparison of advantages and disadvantages of USDT, USDC, DAI Circle submitted 'IPO application' with a valuation looking at $5 billion, why is Coinbase the hidden big winner of USDC? "Too low to sell! Ripple's $5 billion acquisition bid for USDC was rejected by issuer Circle" This article was first published on BlockTempo (BlockTempo - the most influential blockchain news media).