Original Article Title: Circle IPO - Time for Stablecoin Summer?
Original Article Author: @TaikiMaeda2
Original Article Translation: zhouzhou, BlockBeats

Editor's Note: Circle will IPO on the NYSE with the CRCL ticker symbol, potentially triggering a "Stablecoin Summer." With a $67 billion IPO valuation, backing from Cathie Wood and Larry Fink, and high market anticipation, CRCL is seen as a prime bet for stablecoin and blockchain growth, likely leading to a revaluation of DeFi assets.

Below is the original article content (slightly reorganized for better readability):

On June 5, @Circle will debut on the New York Stock Exchange under the stock ticker CRCL in what is seen as the most anticipated IPO since Coinbase ($COIN) in 2021.

For this IPO, Circle plans to issue 24 million shares, raising $6.24 billion with a target valuation of $67 billion.

Reportedly, Cathie Wood's ARK fund will subscribe $150 million, and Larry Fink (BlackRock CEO) will additionally invest $60 million, totaling approximately 35% of this round of financing.

Bloomberg reported that this funding round was oversubscribed.

Wood and Fink can be seen as KOLs (Key Opinion Leaders) in the traditional financial world, likely to drive the "Stablecoin Narrative" together through media exposure, bridging the gap between institutions and retail investors.

The crypto community often criticizes Circle for its high operating costs (credit to @TheOneandOmsy) and points out that it leaks a significant amount of value to Coinbase.

However, the reality is that Circle's stock may be one of the few ways to bet on stablecoin growth and blockchain technology.

Considering that this is a standard IPO rather than a direct listing, insiders cannot sell their shares within the first 180 days. If, as reported, this subscription has been oversubscribed, it is highly likely that CRCL will perform well after listing.

For those in the crypto community, it can be seen as a token listing with "low circulating supply + high fully diluted valuation," with key figures from traditional finance (Wood, Fink) backing it.

We are currently in a period where tech IPOs are performing remarkably well, so I am inclined to disagree with the market's pessimism towards CRCL. USDC is currently the second-largest stablecoin by market capitalization, with a strong distribution channel, and the high operational costs are optimizable. The GENIUS Act is also about to be implemented.

If we consider the average "IPO price to current price" increase of 54.7% for tech stock IPOs, looking at a $67 billion valuation for CRCL upon listing, it is likely to surpass a $100 billion market cap in the short term.

The key question is, what will be the impact on DeFi and the entire crypto market?

Is the Summer of Stablecoins Coming?

The trading performance of $CRCL will greatly influence the valuation trend of DeFi assets. After all, if CRCL's market cap is similar to ENA's, how can ENA justify having a $50 billion FDV?

If CRCL quickly surpasses a $100 billion market cap, projects closely related to stablecoins with actual cash flow may also see a rapid increase in valuation.

For example, if Circle's net profit in 2024 is $157 million and its market cap is $100 billion, then Maker (now rebranded as SKY) earning $107 million at the current $14 billion valuation seems much more attractive.

Of course, this comparative method is not perfect, but the core idea is: if TradFi is willing to pay for CRCL, its "valuation anchor" effect is likely to impact the entire DeFi ecosystem.

Perhaps, the summer of stablecoins is about to begin?

Trading Opportunity

I believe CRCL's IPO has provided a good trading opportunity for DeFi:

Direct Beta Targets: Stablecoin issuers like MKR and ENA directly benefit;

Indirect Beneficiaries: Projects in the related ecosystem such as $PENDLE, $SYRUP, $AAVE also make sense;

Derivative Effect: If these coins start to take off, the contract/spot DEX will also see more on-chain activity.

Furthermore, I personally think that CRCL itself is a good investment target.

Of course, some people are concerned that this IPO is a "top signal" - after all, the last time Coinbase IPO'd was exactly when Bitcoin hit its peak on April 14, 2021. But I believe that this market is not as "frothy" this time:

Back in 2021, BTC dominance (BTC.D) was collapsing, and now, overall altcoins have been "crushed," making the market sentiment more subdued.

In summary: This time is different, maybe the stablecoin summer is really coming.

Another important difference is: $COIN went public through a direct listing, meaning retail investors basically provided liquidity for insiders to "exit." In contrast, CRCL is a regular IPO, with insiders having a 180-day lock-up period, making it less likely to encounter this issue.

In conclusion:

I believe that CRCL will perform very well after its listing. It may be one of the best bets currently available for betting on stablecoin development and blockchain technology growth.

Buying Circle stock itself is a transaction opportunity. However, I also believe that it may trigger a small-scale DeFi season, as CRCL's valuation could "raise the ceiling," providing a revaluation opportunity for high-quality DeFi projects.

If I am wrong and the price of $CRCL falls below the issuance price after listing, then this transaction would be a clear failure and can be stopped out directly.

"Original Article Link"

Welcome to join the official BlockBeats community:

Telegram Subscription Group: https://t.me/theblockbeats

Telegram Discussion Group: https://t.me/BlockBeats_App

Official Twitter Account: https://twitter.com/BlockBeatsAsia