Cricle, a stablecoin project backed by big investment bank Goldman Sachs is in the process for going public. The deal is expected to establish the worth of the company at a whopping $4.5 billion according to some estimates from early reports. Circle already has a lot of on-ground use case as it is a partner of VISA, one of the largest payment companies in the world.
The $4.5 Billion Public Offering backed by Goldman Sachs
Circle is looking at one of the biggest IPOs in the crypto sector. Granted, the trend of crypto companies to go public is a recent phenomenon, several big offerings have already taken place, most notably of Coinbase itself that got listed in the Nasdaq exchange and trades by the name of COIN. Coinbase had a much bigger valuation of around $100 billion but that is expected considering its userbase and global appeal. Circle on the other hand is a much smaller company that provides services to VISA.
However, the backing of Goldman Sachs is going to be an important factor as it has a lot of sway.
Merger vs IPO
So, instead of undergoing the risky but awarding way of an Initial Public Offering (IPO), the company is expected to merge with an existing public company called Concord Investment Group to become a new holding company. A ticker of CRCLE is being considered as the trading name for its listing on the NYSE. It remains to be seen how the new stock will perform in the market especially considering its indirect, less-risky entry. Circle shareholders will 86% equity of the newly established holding company.
When will it Happen?
In addition to the newly established equity, the move will also see the CEO of Circle Jeremy Allaire and Concord chairman Bob Diamond become members of the new holding company’s board. The deal is officially expected to close in the last quarter of this year. The timing of the stock to go public on NYSE is interesting for cryptocurrency traders because it is obvious that the company’s analysts believe that the last quarter of the year will see phenomenal growth for the crypto sector again after careful analysis. The company wants to go public on a high note.
The same is being predicted in the crypto circles as well but only time will tell if the prediction is correct. For now, the crypto sector is in the middle of a price pullback with the index hovering around $33k despite spending most of 2021 above this figure, as high as $65k at one point.
Image Source: Marco Verch Professional under CC