Yiannis Zourmpanos
3 min read
In This Article:
Just a few weeks after a dazzling IPO, stablecoin issuer Circle Internet Group (CRCL) is on a red-hot tear. Its shares have increased 745% from its IPO price of $31, and the company's worth now surpasses that of more than 230 S&P 500 Index ($SPX) firms. Market analysts anticipate that Circle’s share of the stablecoin market is set to expand after a decisive Senate vote in the United States.
The engine of change? The Genius Act, which lays out the first-ever federal standard for stablecoins. As lawmakers move to govern and authenticate digital dollars, Circle is ideally positioned as a standard-bearer of that financial revolution. And with support on both sides of the Street and in Washington, CRCL could be on the verge of becoming the center of a whole new world of dollar-denominated digital finance.
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Circle Internet Group (CRCL) is a technology company that specializes in issuing and operating stablecoins, digital currencies tied to established assets such as the U.S. dollar or gold. Circle is the issuer of USD Coin (USDC), which is one of the most widely used dollar-backed stablecoins on the planet. Its market value of USDC stands at roughly $61.5 billion.
CRCL shares were priced at $31 in their June 5 IPO and have soared above $260 currently. That performance places Circle’s shares in the very exclusive ranks of recent IPOs.
Valuation-wise, Circle currently trades at a 28.3x price-sales ratio due to intense investor demand for cryptocurrency infrastructure plays. A 1% net profit margin and trailing net income of $156 million, however, hint at early profitability, a first for digital asset businesses.
Post-IPO momentum for Circle was provided by the fact that the U.S. Senate approved the Genius Act — nonpartisan legislation that formally considers stablecoins to be valid financial products. The bill defines strict rules for issuance and exchange, and only obliges certified organizations to trade stablecoins secured by fixed-value assets.
CEO Jeremy Allaire celebrated the bill’s passage, calling it “history in the making” and citing its possibilities for raising U.S. competitiveness in digital finance.
