Circle Delays IPO Amid 10% Tariff Uncertainty, $2 Trillion Market Loss

Circle, the company behind the USDC stablecoin, has decided to postpone its planned initial public offering (IPO) due to escalating economic uncertainties tied to new U.S. trade policies. The company, which had filed registration papers with the SEC on April 1, is now reconsidering its plans to go public. This delay comes as several other firms, including Klarna and StubHub, are also reevaluating their IPO strategies in response to market reactions to President Trump’s new tariffs.

Announced on April 2, the tariffs include a 10% base duty on goods from all countries, with additional retaliatory measures targeting nations that tax U.S. imports. This policy shift has ignited fears of a global trade war, leading to significant market volatility. Over $2 trillion in U.S. market value was lost in a single day as investors retreated from riskier assets.

Concerns about a potential U.S. recession are growing, especially after other nations responded with counter-tariffs. ARK Invest's Cathie Wood had previously warned of slowing economic momentum, stating, “The velocity of money is slowing dramatically.” This economic uncertainty has prompted Circle to reassess its IPO plans, which were initially set to list under the ticker "CRCL." The company had confidentially filed a draft registration statement with the U.S. Securities and Exchange Commission in January 2024, following a previous unsuccessful attempt to go public via a special purpose acquisition company merger in 2022.

Despite the current delay, Circle’s CEO, Jeremy Allaire, has emphasized the company’s commitment to becoming a publicly traded entity. In an interview, Allaire stated, “We are very committed to the path of going public. We think we can be a really interesting company in public markets.” Circle had posted $1.67 billion in revenue for 2024, marking a 16% year-over-year increase.

The decision to delay the IPO reflects broader market conditions, with several companies reevaluating their public offering plans amid heightened market volatility. The U.S. dollar declined against major currencies, while the yield curve bull-flattened, signaling increased recession fears. Analysts believe that markets had priced in a stagflationary scenario, anticipating stagnant growth alongside rising inflationary pressures.

Circle's delay aligns with a broader trend of companies reassessing IPO timelines amid economic uncertainties. The company joins a growing list of firms, including fintech company Klarna and ticketing firm StubHub, that are considering IPO delays. This postponement suggests a cautious approach in the face of market uncertainty, potentially impacting Circle's future fundraising plans and public market debut.