- Circle’s 2024 revenue hit $1.67 billion, a 16% increase, but net income fell by 41.8% to $155.6 million.
- The company plans to list its stock under the ticker “CRCL,” aiming for an IPO valuation of $4-5 billion.
- Circle’s USDC stablecoin, with a $60 billion market cap, drives revenue, though partnership costs with Coinbase raise profitability concerns.
Crypto stablecoin issuer Circle Internet Group has filed with the US Securities and Exchange Commission (SEC) for a public offering on the New York Stock Exchange (NYSE). The company, best known for its USDC stablecoin, plans to list its Class A common stock under the ticker symbol “CRCL,” as disclosed in an April 1 Form S-1 registration statement with the SEC.
The exact number of shares to be offered and the initial public offering (IPO) price remain unspecified. However, Circle’s filing revealed substantial financial growth in 2024, with revenue of $1.67 billion, marking a 16% year-on-year increase. Despite revenue growth, Circle’s net income fell by 41.8%, standing at $155.6 million, compared to the previous year’s $268 million.
Circle’s Financial Performance and IPO Expectations
Circle’s move towards going public also reflects a shift in the regulatory landscape for cryptocurrencies in the United States. With the current government showing more openness toward crypto-friendly regulations, Circle is set to benefit from this evolving environment. The potential for upcoming legislation to regulate stablecoins could further bolster Circle’s market position.
The proposed IPO could value Circle at between $4 billion and $5 billion, with JPMorgan Chase and Citigroup serving as the lead underwriters. Circle’s flagship product, the USDC stablecoin, is one of the largest in the market, boasting a market capitalization of around $60 billion, which makes it a central player in the evolving world of digital finance.
Circle’s revenue growth for 2024 came largely from reserve income related to its stablecoin operations, even as its net income declined, as per Matthew Sigel’s post. The demonstrates the high dependency on stablecoin-related activities for Circle’s financial success. The company’s focus on USDC has positioned it well within the expanding crypto economy.
The Regulatory Shift and Market Expansion
Circle’s IPO filing highlights a broader shift in the US regulatory environment for cryptocurrencies, especially stablecoins. Under the current administration, which is more crypto-friendly, there is optimism for future legislation to regulate stablecoins, which could significantly benefit Circle’s market position. The regulatory environment aligns with Circle’s strategy to strengthen its foothold in the global economy.
Circle’s collaboration with major players like Coinbase, with whom it shares revenue generated from USDC, further underscores its importance in the crypto ecosystem. The company’s relationships with exchanges solidify its role as a key player in the digital finance market. As stablecoins continue to gain traction, Circle’s IPO could offer investors a chance to participate in its future growth.
Circle’s financials show a reliance on its partnership with Coinbase, with nearly $908 million paid in 2024 for USDC distribution on the exchange. The significant cost raises concerns about profitability, as it leads to a situation where Coinbase is profiting more from USDC than Circle itself. Despite this, Circle’s growth in revenue indicates strong market demand for its stablecoin.
Read More: USDC Issuer Circle Plans To File IPO In Late April