Circle, the creator of USDC, EURC stablecoins to launch IPO in 2024

Circle, the creator of USD Coin (USDC), the popular stablecoin, is set to launch an Initial Public Offering (IPO) in 2024. According to Bloomberg, the company is already talking to advisors as it prepares for this.

Circle Internet is one of the most important companies in the blockchain industry. It created USD Coin, a stablecoin with over $24 billion in assets. It also created EURC, a stablecoin that is backed by euros. EURC has a combined market cap of over $53 million.

Circle’s stablecoins operate across numerous blockchains like Stellar, Ethereum, and Avalanche. According to its website, USDC has handled over $12.6 trillion on-chain transactions in its history. Over 1.8 million people hold the stablecoin.

Stablecoin issuance companies are literally cash printers. The companies make money by simply investing the cash in safe assets like short-term government bonds. In this case, the company has invested approximately $24 billion, earning about 5% interest. 

This means that the company could generate as much as $1.2 billion in revenue this year if the amount stands at the current phase. For example, the most recent results by Tether Holdings showed that the company’s operating profit jumped to over $1 billion in the second quarter. Tether is much bigger than USD Coin, thanks to its over $86 billion assets.

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Circle’s revenue will likely continue doing well as interest rates remains at an elevated level. In its decision last week, the Federal Reserve decided to leave interest rates unchanged between 5.25% and 5.50%. Most analysts believe that the bank will leave rates at an elevated level for a while.

Circle’s stablecoin is used widely in the blockchain and off-chain world. One of its top utilities is because of its partnership with MoneyGram. According to the deal, USDC holders can now send money internationally and people can withdraw the funds in US dollars. 

A key concern for stablecoin holders is how stable they are. In UDDC case, the stability comes from the fact that the company is audited by Deloitte, one of the top 4 accounting companies. Its reserves are held by companies like Blackrock and BNY Mellon.

It is unclear the valuation that Circle will seek. In 2022, the company was to go public by merging with Concord Acquisition Corp. The deal valued Circle at over $9 billion. Therefore, there is a likelihood that it will attract a bigger valuation.

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