BlackRock intends to purchase roughly 10% of the shares up for sale in Circle Internet Group’s eagerly awaited IPO. By selling 24 million Circle shares at a price between $24 and $26 a share, the company and its current shareholders want to raise up to $624 million. At the higher end of this range, Circle would be valued at over $6.7 billion when completely diluted, making it one of the most valuable cryptocurrency startups to go public.
BlackRock joined Cathie Wood’s ARK Investment Management, which has expressed interest in buying up to $150 million worth of shares in Circle, demonstrating the strong institutional support for the company’s IPO. Circle’s business plan and growth prospects in the quickly growing stablecoin market are significantly validated by this institutional support.
An unusual feature of the IPO is that, while the firm itself issued 9.6 million new shares, its current stockholders sold 14.4 million shares. In tech IPOs, the insider selling ratio typically remains below 50%; therefore, this 60% ratio is unusually high.
The company has faced a particularly challenging journey in entering the public markets. A $9 billion SPAC merger, supported by Bob Diamond, was the company’s first attempt to go public in 2021; however, it fell through in late 2022. Before choosing to go with the IPO route, Circle reportedly considered a possible $5 billion sale to businesses like Coinbase and Ripple, according to recent reports.
USDC Dominance and a Favorable Crypto Environment
Given President Donald Trump’s administration’s endorsement of digital assets and pledges of more “rational” regulatory methods, the timing of Circle’s first public offering (IPO) shows increased optimism in the cryptocurrency sector. Following years of uncertainty, this change in regulatory mood has prompted many cryptocurrency startups to seek public listings.
With over $60 billion in circulation and roughly 27% of the whole stablecoin market value, Circle’s main asset, the USD Coin (USDC) stablecoin, commands a substantial market presence. Despite being behind Tether’s 67% market share, USDC has shown remarkable growth this year, with its market capitalization increasing by 40%, outpacing Tether’s 10% growth.
The involvement of significant financial institutions as underwriters is another indication of Wall Street’s growing support for crypto companies. With assistance from Barclays, Deutsche Bank Securities, Société Générale, J.P. Morgan, Citigroup, and Goldman Sachs are acting as joint lead bookrunners.
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