Circle Aims for IPO with NYSE Listing Under 'CRCL' Ticker
By: Eliza Bennet
Circle, the prominent fintech firm behind the widely used USD Coin (USDC), has taken a significant step toward going public by filing an S-1 registration with the U.S. Securities and Exchange Commission (SEC). The company seeks to list its Class A common stock on the New York Stock Exchange (NYSE) under the ticker symbol "CRCL." This move marks a thrilling chapter for Circle as it shifts towards the traditional IPO route, following previous attempts at public listing via a merger with a special purpose acquisition company (SPAC) that ultimately did not come to fruition.
According to the prospectus, Circle intends to offer an undisclosed number of shares in the IPO. Additionally, certain existing shareholders will also register shares for sale. However, the price range per share has not been determined yet. The proceeds from shares sold directly by Circle will be used for multiple facets of the company, such as product development, operational scaling, and potential acquisitions, as Circle positions itself within the expanding digital dollar ecosystem driven by increasing stablecoin adoption.
The financial data in the filing provides insights into Circle's robust performance over recent years. In 2024, the company reported a revenue total of $1.68 billion, a notable rise from previous years, with the bulk derived from reserve income tied to interest on assets supporting USDC. Despite showing a decline in net income from continuing operations—from $271.5 million in 2023 to $156.9 million in 2024—the company has significantly improved its financial standing, recovering from a substantial loss in 2022. Furthermore, Circle's operating expenses were primarily allocated to personnel compensation, administrative costs, and IT infrastructure.
The IPO plan encompasses a three-tier share structure, with Class A shares carrying one vote each, while Class B shares, held by co-founders Jeremy Allaire and Patrick Sean Neville, carry five votes. Class C shares do not have voting rights and can convert under specific conditions, ensuring diverse means of shareholder influence. The IPO will be leveraged with the regulatory review and market variables dictating terms. The underwriters, led predominantly by JPMorgan and Citigroup, have the option to purchase additional shares to cover over-allotments.
Circle's decision to go public comes amidst a backdrop of increasing interest in the regulation of digital dollar infrastructures. The company's path to the IPO reflects the evolving dynamics in the cryptocurrency market as major players like Circle transition towards public markets, aiming to solidify their presence and expand further within the burgeoning financial landscape.
