What to know:
- Circle’s shares surged to a new record on Monday before adjusting gains, leading to a post-IPO rally of 750%.
- The firm’s market valuation approached the supply of its major token, the $61 billion USDC, and is nearing that of cryptocurrency exchange Coinbase.
- Despite elevated valuation metrics, the stock reflects strong investor interest in the expanding stablecoin market as U.S. lawmakers move towards regulation.
Shares of Circle (CRCL) climbed to a new peak on Monday, extending their impressive rally following the IPO, and making the company’s worth comparable to that of its flagship token’s market cap.
At one point during trading, shares escalated by 22%, reaching just under $299, before retreating slightly. The stock closed around $263, marking a 9% increase for the day. Since going public earlier in the month at an offer price of $31, shares have skyrocketed by an impressive 750%.
At its pinnacle, Circle’s market cap neared approximately $60 billion, almost equal to the $61.3 billion supply of its USDC stablecoin. This positions the company close to crypto exchange Coinbase (COIN), which has a market cap hovering around $78 billion.
The recent surge in Circle’s stock price signals the increasing investor demand for the rapidly growing stablecoin sector—a niche in cryptocurrency where only a handful of companies are publicly traded. USDC remains the second-largest dollar-pegged token available, widely utilized across exchanges and decentralized finance (DeFi) ecosystems, and steadily gaining popularity for payment solutions and cross-border transactions.
Factors supporting this rally include the U.S. Senate’s recent passage of the GENIUS Act, which seeks to establish regulations for the asset class that could potentially reach trillions over the coming years.
Some analysts, however, caution that the rally may be outpacing the underlying fundamentals.
The market cap surge positions Circle alongside prominent fintech giants such as Robinhood ($68 billion), Nubank ($59 billion), Block ($38 billion), and not far from Coinbase ($78 billion), according to Jon Ma, the CEO of a cryptocurrency analytics firm.
The stock is currently trading at stunning valuation multiples seldom seen among its fintech and cryptocurrency counterparts: 32x revenue, 80x gross profit, 152x EBITDA, and 285x earnings. “There isn’t much room for upside in the current model,” Ma remarked in a prior update.
