Circle IPO Soars 167% on First Trading Day

Circle made its public market debut yesterday — and markets roared in approval.

Until now, investors had no clean way to express their bullish thesis on the stablecoin industry. That changed yesterday — and with a bang. Circle rang the opening bell and surged into the public markets, with shares rocketing from a $31 IPO price to a $97 intraday high before closing at $82.80.

What a debut! But in all honesty: How did the bankers miss this so badly? When a stock pops > 200% on day one, it’s not just excitement — it’s mispricing. Either way, the IPO window is now wide open, and others will surely try to follow.

To mark the occasion, we asked two seasoned investors for their take on Circle. One is bullish. One is bearish. You’ll find both perspectives below.

These are the week’s big stories we’re covering today:

  • Trump and Musk are breaking up, and risk assets are feeling it

  • Circle IPO debut: The bull & bear case

  • Ethereum Foundation announces 2 major initiatives

MARKET COMMENTARY

Last updated: June 6th, 01:09 a.m. CET

The world’s richest person is now feuding with the world’s most powerful — and markets don’t like it. Elon Musk’s public fallout with Donald Trump sent shockwaves through tech stocks, dragging TSLA down over 14% and pulling the Nasdaq and crypto markets lower. Bitcoin dropped nearly 5%, sliding to $101,000.

The public split came just as new U.S. economic data pointed to a slowdown. A key report showed that the U.S. services sector unexpectedly contracted in May — the first time since last summer. Meanwhile, prices in both services and manufacturing continued to rise. That mix — slowing activity and rising costs — is a tough combination for investors.

Labor market data added to the jitters. A private-sector jobs report showed just 37,000 new hires in May — far below the expected 111,000. That steep miss raised concerns ahead of today’s official jobs numbers.

All in all, it was a rough day for risk assets. And while the Musk–Trump drama will likely dominate headlines without causing lasting damage, investors are keeping a close eye on the economic data.

NEWS FLASH

PUBLIC MARKETS

Circle’s IPO Sends Strong Signal for Crypto Markets

Opening Bell: Circle made its public market debut yesterday and markets roared in approval. Shares opened at $31 and soared as high as $97, before settling at $82.80 by the close, giving the stablecoin issuer a market capitalization of over $16 billion.

  • Why it matters: This marks only the second major U.S. crypto IPO after Coinbase’s 2021 listing — and the second-strongest first-day performance of any IPO in the U.S. this year. It’s a powerful signal of investor confidence in crypto equities and could pave the way for more public listings in the sector.

Not acquired — but desired: Until recently, Circle’s IPO wasn’t guaranteed. Both Ripple and Coinbase were rumored to have explored acquisition talks, though Ripple CEO Brad Garlinghouse publicly denied making a formal bid this week.

IPO by the numbers: Circle raised nearly $460 million in primary capital, selling 14.8 million shares at $31 each. Existing shareholders sold an additional 19.2 million shares into the offering.

  • CEO numbers: Among them was CEO Jeremy Allaire, who sold 1.5 million shares, earning approximately $49 million, according to the prospectus.

Who’s buying: Combined with momentum around U.S. stablecoin regulation, Circle’s strong day-one demand was likely fueled by speculation that BlackRock — a key Circle partner — would purchase up to 10% of the offering. ARK Invest, too, committed $150 million.

Vlat is an Investment Partner at Moonrock Capital, a Munich-based crypto-native advisory and investment firm.

Many investors came away skeptical after Circle’s S-1 filing in April — pointing to revenue-sharing agreements with Coinbase and the risk of falling interest rates eating into yield. But those concerns may be overstated. They overshadow the fundamentals: Circle is the largest regulated onshore stablecoin issuer, deeply embedded in DeFi, and well connected in Washington.

Judging by the IPO’s oversubscription and rising valuation, institutional investors seem to agree. And while falling rates compress yields, they can also boost onchain activity by making DeFi yields more attractive — potentially increasing USDC’s supply and offsetting revenue declines through scale.

Historically, the primary demand for stablecoins has come from their role as trading pairs on centralized exchanges (CEXs). Giving up net interest margin to Coinbase was a tradeoff to achieve distribution and scale a broader payment network. As stablecoins shift toward use in payments and remittances, Circle could pivot to a transaction-based model akin to Mastercard or Visa. With CCTP and the Circle Payment Network, there's a credible path to build both technical and regulatory moats.

Tom Dunleavy is the Head of Venture at Varys Capital, a global, multi-strategy digital asset fund and venture capital firm. Prior to joining Varys Capital, Tom worked at MV Global and Messari.

Circle is basically a business line of Coinbase.

Most of the revenue comes from interest on reserves — and Coinbase takes the lion’s share: 100% of the yield on USDC held on their platform, and 50% elsewhere. That’s a tough setup, especially with interest rates likely heading lower.

The current investor interest? Mostly driven by stablecoin fervor and folks vastly underexposed or sidelined there. You can't invest in Tether.

But the fundamentals don’t convince me. Market share is down from 35% to 25%, and competition is heating up fast. If you’re bullish on crypto infrastructure, just buy Coinbase. More exposure. Better optionality.

ETHEREUM

Ethereum Foundation Pushes Forward with Major Restructuring

Restructuring: This week, the Ethereum Foundation announced two major restructuring initiatives concerning the organization of its core R&D teams and its future treasury policy.

Strategic Goals: On Monday, the EF introduced “Protocol”, a reorganization of its R&D teams around three strategic goals: scaling the L1, scaling blobs (i.e., the L2s), and improving the UX.

New Leaders: Each of these goals will be pursued by a dedicated unit led by two Ethereum researchers. All teams will be advised by Dankrad Feist, one of the key architects of Ethereum’s rollup-centric scaling roadmap.

Treasury Policy Update: Alongside the organizational changes, the EF also introduced a revamped treasury strategy. First, the foundation plans to cap annual operating expenditure at 15% of its treasury while maintaining a 2.5-year reserve buffer. Over time, the EF plans to reduce this annual spend to just 5%, shifting towards a leaner, more sustainable operating model.

  • Doubling down on DeFi: Following deployments in Aave and other lending protocols earlier this year, the EF has now formalized its strategy and plans to actively use DeFi to manage parts of its treasury. This includes staking ETH, supplying ETH on lending platforms, and borrowing stablecoins against its holdings.

Back to Cypherpunk: At the core of this new policy is the “Defipunk Framework” — a value-driven approach that defines which DeFi protocols the EF considers worthy of capital support. The EF intends to prioritize and concentrate deployments into protocols that adhere to a set of Ethereum-aligned principles like...

  • Permissionlessness: Protocols should allow unrestricted interaction without KYC or whitelisting.

  • Self-Custody: Users should maintain control over their assets by default.

  • Open-Source: Contracts must be open-source under permissive licenses.

  • Privacy: Emphasis on shielding transaction details and minimizing data collection.

Transparency Measures: To ensure credibility, the EF will publish quarterly internal performance updates and annual reports outlining its treasury allocations.

For years, the relationship between EF leadership and the DeFi ecosystem was, well, complicated — despite protocols like Aave, Sky, and Uniswap being integral to Ethereum’s ecosystem.

Now, however, the (new) leadership seems to recognize that instead of fighting its own strengths, it should double down on them.

And rather than merely preaching Ethereum alignment — often without clearly defining what that even means — the EF is now setting concrete rules and letting its $900 million ETH warchest do the talking by incentivizing builders who embed Ethereum’s core values into their protocols.

After years of drifting, Ethereum finally seems to be reorienting itself. Its current set of goals now aligns with what developers actually want the foundation to focus on: building scalable infrastructure for unstoppable, censorship-resistant applications that can support billions of users.

And this pivot matters, because as we saw in recent months, Ethereum’s position as the dominant smart contract platform is anything but guaranteed. Competing ecosystems like Solana have gained ground by moving faster, operating with cohesion, and executing more like startups — while Ethereum, by contrast, has been weighed down by its idealistic values.

Still, the fundamentals remain on Ethereum’s side. It continues to lead in terms of TVL, developer activity and cutting edge R&D like zero knowledge technology. And if it can now move with greater focus and urgency, Ethereum still has the best shot at becoming the trust layer for the global internet economy.

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Avantis | $8 million | Series A : Decentralized trading platform, enabling users to trade crypto, forex, and commodities with up to 500x leverage and zero fees.

3Jane | $5 million | Seed : A money market that provides real-time, unsecured USDC credit lines.

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