USDC issuer Circle surged on its third trading day
Circle surged on its third trading day, climbing to a record intraday high of $138.57 Monday morning amid a wave of continued institutional and retail enthusiasm.
The stock, which debuted on Thursday after pricing its IPO at $31 per share, has now more than quadrupled in value—posting a roughly 347% gain from its offering price to its Monday peak. CRCL has cooled to $116.20 as of this writing, still up 8% on the day.
Investors have moved nearly 37 million CRCL shares already Monday, meaning that the company could top the 60.7 million shares that traded during Friday’s session.
Japanese financial services company SBI Holdings confirmed Monday that it invested $50 million into the newly public stablecoin issuer. “Amid strong demand from numerous institutional investors, etc., the SBI Group secured one of the largest allocations of Circle shares,” the company wrote in a press release.
And on Circle’s opening day, Cathie Wood’s ARK Invest trimmed its positions in Robinhood, Coinbase, and Block to buy 4.48 million shares of CRCL. As it stands, the company’s flagship ARK Innovation ETF, ARK Next Generation Internet ETF, and the ARK Fintech Innovation ETF now hold a combined 4,431,862 CRCL shares.
Assuming ARK got in at the $31 IPO price, the firm could be sitting on an unrealized gain of more than $524 million, or 281%.
There are other signs of intense institutional interest. Fund manager ProShares filed on Friday to offer an Ultra CRCL ETF. The fund would be a leveraged play, meaning that its objective is to double the gains or losses that the stock sees on a given day, according to its prospectus.
Meanwhile, the Bitwise CRCL Option Income Strategy ETF sets out to be a covered-call style ETF. That means the fund managers would generate income for investors by selling call options on CRCL shares.
It’s worth noting that Circle makes almost all of its revenue from interest earned on the cash it uses to back its stablecoins. That means a rate cut—which crypto investors are otherwise very happy to see because it triggers reallocation into digital assets—could be bad for the USDC issuer’s bottom line.
Currently, 53% of investors think the Federal Open Markets Committee could announce a rate cut of 25 basis points following the group’s September 17 meeting, according to the CME FedWatch Tool.
FundStrat analyst Sean Farrell estimated on X last week that every 25 basis point cut the FOMC makes to interest rates could reduce Circle’s 2026 EBITDA by $100 million.
“Circle operates in a vertical we expect to grow exponentially over the next decade, but it is not the market leader and lacks control over distribution,” he added. “It is levered to interest rates, with lower rates hurting earnings. In a world where rates fall while stablecoin adoption rises, investors may be better served by liquid crypto assets and equities more directly tied to crypto prices.”
Edited by Andrew Hayward