XRP News Today: Circle Internet Financial Explores $5 Billion Sale to Coinbase or Ripple

Circle Internet Financial, the issuer of the USDC stablecoin, is reportedly in informal talks to sell itself to either Coinbase or Ripple. The discussions come just weeks after Circle filed publicly for its long-anticipated initial public offering (IPO) in early April. Sources from the banking and private equity sector say Circle is seeking at least $5 billion, the same valuation it is targeting for the IPO. The company is still committed to going public, but the talks with Coinbase and Ripple suggest it is exploring multiple paths.

Ripple has already made a bid in the range of $4 billion to $5 billion, but that offer was turned down as too low. The offer was likely a mix of cash and XRP, the cryptocurrency issued by Ripple. Ripple has a large balance sheet, including 4.56 billion XRP valued at around $11.77 billion, and another 37.13 billion XRP in escrow.

Coinbase, meanwhile, is seen as a more natural acquirer. The two companies share a long history through their joint venture, Centre Consortium, which launched USDC in 2018. Though the consortium dissolved in 2023, Coinbase retains an equity stake in Circle and continues to share in the USDC revenue. Their agreement heavily favors Coinbase. According to Circle’s S-1 filing, Coinbase receives 50% of the residual revenue from USDC’s reserves, and 100% if USDC is held on its platform. The arrangement also gives Coinbase approval rights over Circle’s USDC partnerships and partial control over its intellectual property in case of insolvency.

As of March 31, Coinbase had $8 billion in cash, with options to raise more through debt or equity, indicating that its financially equipped for a deal. Speaking with Bloomberg on May 14, Coinbase CEO Brian Armstrong said, “They’re going public doesn’t change anything about our commercial relationship.” When asked about a possible acquisition, Armstrong responded, “Nothing to announce today,” but confirmed Coinbase is always open to M&A opportunities.

Circle, Coinbase, and Ripple have not commented publicly on the matter. While an IPO remains in play, a sale, especially to Coinbase, appears to be a serious possibility. Coinbase and Ripple have been busy expanding their reach through high-profile deals. Coinbase, now officially part of the S&P 500, has seen its shares jump over 25% in the past week. Earlier this month, Coinbase confirmed the $2.9 billion acquisition of Deribit, the crypto options exchange boasting $30 billion in open interest. The deal, a mix of cash and stock, aims to make Coinbase a one-stop shop for derivatives, spot, and futures trading worldwide. Completion is expected by the end of 2025.

Ripple, too, has made bold moves. In April, it acquired prime brokerage firm Hidden Road for $1.25 billion, securing a foothold in TradFi infrastructure. With over $3 trillion cleared annually, Hidden Road positions Ripple as a serious institutional player. Meanwhile, Circle’s IPO aspirations may find renewed optimism after eToro’s strong debut last week.

In summary, Circle Internet Financial is exploring a potential $5 billion sale to either Coinbase or Ripple, indicating flexibility to stay independent via an IPO. Coinbase is seen as a more natural buyer with the funds and synergy to integrate USDC, while Ripple’s offer was declined as too low. The high-stakes race between these two crypto giants highlights the strategic importance of USDC and the evolving landscape of the cryptocurrency industry.