MoranElkarifNews: Stablecoin issuer Circle soars 168% in NYSE debut after pricing IPO above expected range

Shares of Circle Internet Group soared 168% on Thursday after the stablecoin company and its selling shareholders raised almost $1.1 billion in an initial public offering.

The stock opened at $69 on the New York Stock Exchange after its IPO priced at $31. At one point, shares traded as high as $103.75.

The New York-based company priced its IPO late Wednesday far above this week’s expected range of $27 to $28, and an initial range last week of between $24 and $26, valuing the company at some $6.8 billion before trading began.

Trading volume by the end of the session was about 46 million, far exceeding the number of freely floating shares available for trading.

Circle joins Coinbase, Mara Holdings and Riot Platforms as one of the few pure-play crypto companies to list in the U.S. This marks the company’s second attempt at going public. A prior merger with a special purpose acquisition company collapsed in late 2022 amid regulatory challenges.

“To realize our vision, we needed to forge relationships with governments, we needed to work with policymakers … because if you want this to work for mainstream, it’s got to work in mainstream society and you need to have those rules of the road,” CEO Jeremy Allaire told CNBC’s “Money Movers” on Thursday. “We’ve been one of the most licensed, regulated, compliant, transparent companies in the entire history of this industry, and that’s served us well.”

The crypto industry is enjoying newfound political favor under a friendly U.S. administration. The stablecoin sector specifically has been ramping up on the expectation that Congress will pass stablecoin legislation this summer. Wall Street analysts say it could grow 10-fold over the next five years, creating a trillion-dollar market opportunity.

Allaire co-founded Circle in 2013. Based in Boston, the company initially focused on consumer-facing payments and crypto wallet and exchange services and was the first to receive the famously difficult to obtain New York State BitLicense in 2015. It moved to New York earlier this year.

Circle founded the U.S. dollar-pegged USDC stablecoin to establish a standard for fiat money on the internet, launching it in partnership with Coinbase in 2018 through a consortium called Centre. In 2023, they dissolved Centre as a stand-alone entity, with Circle taking over the responsibilities of USDC and Coinbase taking a minority stake in the stablecoin company.

The two companies also entered into an agreement to split the revenue of USDC stablecoin, and Coinbase CEO Brian Armstrong said on the company’s most recent earnings call that it has a “stretch goal to make USDC the No. 1 stablecoin.” 

USDC is the second-largest stablecoin on the market, behind Tether’s USDT.

Stablecoins are cryptocurrencies whose values are pegged to that of another asset, usually the U.S. dollar. Traditionally used as bridge currencies for crypto traders, stablecoins today are benefiting from increased interest by banks and payment firms as the Trump administration rolls back Biden-era crypto policies and in anticipation of Congress blessing the system.

Specifically, companies that aren’t traditional users of cryptocurrencies are now interested in the efficiency and lower cost that stablecoins might bring to remittances, business-to-business payments and e-commerce, at the same time as they remain essential to tokenized financial markets. Rhetoric around stablecoins preserving U.S. dollar dominance — partly by ensuring demand for U.S. government debt, which backs nearly all dollar-denominated stablecoins — has grown louder, too.

Correction: Circle opened at $69 on the New York Stock Exchange. An earlier version of this story misstated the stock’s opening price.