Circle Aims for $7.2 Billion Valuation in NYSE IPO

Circle, the company behind USDC—the world’s second-largest stablecoin—is set to go public on the New York Stock Exchange on June 4. The company will offer 32 million Class A shares at a range of $27-28 under the ticker CRCL, aiming for a $7.2 billion valuation. This event is one of the most anticipated in the crypto business this year.

Circle’s business model, while seemingly straightforward, involves issuing stablecoins and investing the reserves in Treasuries to earn risk-free yield. However, the future of interest rates remains uncertain, and the company must navigate margins and costly partnerships. In a competitive market, Circle must either outpace the impact of potentially falling rates by capturing a larger share of the stablecoin market or simply grow with it. The firm’s long-term success may also depend on its ability to diversify and build synergy across its products.

Stablecoins have become a crucial part of crypto markets and are increasingly relevant for traditional finance. In 2024, stablecoin transaction volume reached $27.6 trillion, surpassing the combined volume of Visa and Mastercard by almost 8%. The total stablecoin market cap now stands at $248 billion, with Circle’s USDC holding a 25% share—second only to Tether’s USDT at 61%—and accounting for $60 billion of the total. Circle’s EURC leads among euro-backed stablecoins with a $224 million market cap.

Circle stands out in regulatory compliance. In the U.S., USDC has positioned itself as a compliant bridge between the crypto ecosystem and traditional finance. In the EU, the implementation of MiCA—and the resulting delisting of non-compliant stablecoins like USDT from major regulated exchanges—has paved the way for USDC to become the region’s leading stablecoin. Citi’s recent report estimates that the stablecoin market could reach a size of $1.6 trillion by 2030 in its base case, positioning Circle well to benefit from this growth.

Circle’s main revenue stream comes from investing stablecoin reserves, primarily in short-term U.S. Treasuries. In 2024, this model generated roughly $1.6 billion in interest income. However, this reliance exposes a risk of over-dependence on interest rates. As Todd H. Baker, a senior fellow at Columbia University, wrote, Circle isn’t really a tech play at all. Financially, a highly levered, uninsured narrow bank… It makes money when rates are higher, up to a point, and makes less or loses money when rates are low.

Another concern is distribution cost. Of Circle’s $1.6 billion revenue, over $1 billion went to “distribution, transaction, and other costs.” The bulk of that went to Coinbase—Circle’s former USDC co-manager and now a key partner. After dissolving the Centre Consortium in 2023, Circle took full control of USDC in exchange for a new revenue-sharing agreement. Under this deal, Coinbase receives 50% of the residual yield from USDC reserves and 100% of the interest generated by USDC balances held on its platform. In return, Coinbase pledged to “support USDC” and “help drive long-term success of the stablecoin ecosystem.”

With most of its revenue linked to interest rates and a significant share going to Coinbase, Circle’s long-term prospects could increasingly depend on its ability to diversify. Beyond USDC and EURC stablecoins, Circle offers Circle Mint, an institutional platform for minting and redeeming USDC and EURC; CCTP (Cross-Chain Transfer Protocol), a system for native, smart contract-enabled USDC transfers across blockchains; CPN (Circle Payments Network), a programmable settlement layer for KYC-compliant financial institutions; and USYC, a yield-bearing tokenized fund with near-instant redeemability to USDC, currently available only to qualified non-U.S. investors.

While revenues from CPN and USYC weren’t included in the S-1 (both too recent), they could effectively diversify Circle’s revenue streams. The CPN in particular could evolve into a blockchain-native alternative to SWIFT—one that’s programmable, compliance-aware, and built for 24/7 financial infrastructure. It’s a compelling bet in a payments market estimated at around $2 trillion annually. USYC, meanwhile, enters the booming market of yield-bearing stablecoins and tokenized treasuries. Assets in such products surged 490% in 2024—from $1.4 billion to $8.25 billion—and now approach $10 billion. In the segment led by BlackRock-backed Ethena’s sUSDe and Sky’s (formerly MakerDAO) sUSDS and sDAI, USYC is still a minor player, holding 4% of the market.

Investors appear to think Circle’s IPO is a bet worth making. The company responded by increasing its valuation target from previously announced $5.65 billion to $7.2 billion. Stablecoins are becoming the de facto digital dollars, especially in a U.S. environment increasingly hostile to CBDCs. Their addressable market spans global remittances, institutional payments, and DeFi integrations. The infrastructure and regulatory positioning that Circle has built could give it a head start, even as traditional giants like JPMorgan, Wells Fargo, and Citi intend to conceive their own stablecoin.

Indeed, the bipartisan GENIUS Act—America’s most comprehensive stablecoin bill yet—passed the Senate on May 21 and now heads to the House. Following the vote, President Trump's Crypto Czar David Sacks said that the GENIUS Act will "pass with significant bipartisan support." The timing couldn’t be better for Circle’s IPO. All in all, Circle isn’t just a bet on interest rates—it’s a bet on the future of regulated crypto finance. With stablecoin adoption growing and a compliance-first model, Circle could become a key pillar of tomorrow’s payment system. For $CRCL holders, the challenge will be navigating the gradual shift from "easy" rate-driven gains to a more demanding reliance on product-driven revenue. Whether Circle can evolve in time is the question the IPO asks—and the market will soon answer.