Circle Eyes $5 Billion Sale Amid IPO Plans

Circle, the issuer of the USDC stablecoin, is reportedly considering a potential sale at a valuation of at least $5 billion. The discussions involve two major players in the cryptocurrency industry: Coinbase, the leading crypto exchange in America, and Ripple, a blockchain payments firm. These talks are occurring while Circle is also planning an initial public offering (IPO).

According to sources familiar with the matter, Circle has been involved in informal takeover talks, seeking a valuation of at least $5 billion from potential buyers. Ripple had previously offered to acquire Circle for up to $5 billion, but this offer was rejected as being too low. Despite this rejection, sources indicate that Ripple remains interested in Circle and has not ruled out making another offer. Ripple's proposed deal likely included a significant portion of the payment in the XRP cryptocurrency, which may be discounted by Circle due to its plans for a public listing.

Coinbase, on the other hand, would pay for Circle using a combination of cash and stock. Given the long-standing partnership between Circle and Coinbase, which began with the launch of the CENTRE Consortium in 2018, Circle might prefer to sell to Coinbase. The two companies have a revenue-sharing agreement from the stablecoin’s reserve interest income, and Coinbase has an agreement to list USDC on its trading platform. This partnership could make Coinbase a more attractive buyer for Circle.

Circle's potential sale comes at a time when several crypto-related companies are considering going public. Circle submitted a Form S-1 registration statement with the U.S. Securities and Exchange Commission (SEC) in April, but later considered delaying its IPO due to macroeconomic uncertainty. This uncertainty was sparked by sweeping trade tariffs implemented by the administration. Despite these challenges, Circle's potential sale and IPO plans highlight the growing interest in the cryptocurrency industry and the potential for significant financial transactions within it.