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USDC Stablecoin Backer Circle to Go Public in $4.5B SPAC Deal

Circle will go public by way of Bob Diamond's Concord Acquisition Corp.

Jul 8, 2021 at 11:05 a.m. UTC
Updated Sep 14, 2021 at 1:22 p.m. UTC

Circle is going public in a deal that values the crypto financial services firm at $4.5 billion, the company said Thursday.

Circle will go public by way of Concord Acquisition Corp (NYSE: CND), a publicly traded special purpose acquisition corporation (SPAC).

Last month, Circle raised $440 million in one of the biggest funding rounds in crypto history. At the time, a Circle spokesman declined to comment on the company’s valuation. Fellow stablecoin issuer Paxos was valued at $2.4 billion after raising a $300 million Series D in April.

Circle going public puts both members of USDC's Centre Consortium on the public markets. USDC, the stablecoin jointly administered with Coinbase, has surged in popularity in the stablecoin sector with a circulating supply of nearly $26 billion. It's seen by some as the safer cousin to the industry-leading USDT.

Circle recently supported USDC's rollout to Tron, with other blockchains in the works.

Circle also debuted a savings product that could get bigger financial players into crypto markets. Lending market Compound launched a USDC product aimed at neobanks and fintech firms, offering 4% interest on USDC deposits. A similar product, albeit more consumer-focused, was launched by Coinbase shortly after.

“As we look at what we’re building,” Circle co-founder Jeremy Allaire said Thursday in an interview on CNBC, “we just see an incredible opportunity to grow, to grow rapidly and to grow around the world.”

Indeed, a company presentation on the SPAC deal listed an expected USDC circulation of $190 billion by 2023 – sevenfold growth from its current $26 billion.

Growth projections from a Circle presentation on the SPAC deal.

“We’re investing heavily in product development and engineering,” said Allaire, as “blockchain finance becomes the backbone of the global financial system.”

Terms of the deal

Circle's deal with Concord is anticipated to close in Q4 2021, the firms said Thursday. 

The deal’s backers lined up an additional $415 million of capital commitments from investors including Marshall Wace, Fidelity, ARK Investment Management’s Adage Capital and Third Point.

Circle's Allaire will remain CEO of the company; Concord Chairman Bob Diamond will join the board.

Concord is run by several former Wall Street veterans who have banded together in recent years to shop for possible acquisitions and other investments in the financial industry. Diamond, the former CEO of Barclays during the financial crisis, resigned from the bank in 2012 during the Libor scandal, where Barclays staff were allegedly involved in helping to manipulate global money-market rates. 

Concord shares are up 6.2% in premarket trading, according to Nasdaq.

Concord went public on the New York Stock Exchange in December through a $240 million initial public offering, according to a press release at the time.

Bradley Keoun contributed reporting.

DISCLOSURE

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