Let’s find out What is Circle Cryptocurrency | USDC Stablecoin also we will know if the circle cancels SPAC plans then what now? Circle the mega-company that is seemingly intent on becoming the dominant entity in the Crypto space. Well, those plans recently suffered a setback when the company announced that its plans to go public were being shelved.
So what happened and why? And have Circles ambitions been well and truly dented beyond repair? So Circle is in short one to watch very closely now. Let’s take a look.
What is Circle Cryptocurrency | USDC Stablecoin | Circle cancels SPAC Plans?
Circle is a truly fascinating company and is a much more influential entity in the crypto industry than many may realize in any case the TLDR Is that Circle is a US-based company that has received a lot of funding from the likes of Goldman Sachs and Black Rock?
That’s a good start isn’t it can’t imagine there’s anything to worry about there. Now, the circle is well known as the issuer of the USDC Stablecoin the second-largest stablecoin by market cap.
And the money it earns from interest payments on the assets backing USDC adds up to hundreds of millions of dollars a year.
What is Circle Crypto?
Circle is a peer-to-peer payments technology company. It was founded by Jeremy Allaire and Sean Neville in October 2013. Circle is the issuer of the USDC stablecoin, with US$55 billion in circulation as of August 2022.
Who is Jeremy D. Allaire?
Jeremy D. Allaire is an American-born technologist and Internet entrepreneur. He is the CEO and founder of the digital currency company Circle and chairman of the board of Brightcove. With his brother JJ Allaire, he co-founded Allaire Corporation in 1995.
What is Circle Cryptocurrency – Crypto Market Update:
Now it’s more than likely that a lot of that money is going to be used to buy up large amounts of crypto to then stake on proof-of-stake networks like Ethereum.
And this is how Circle is set to become one of the most influential entities in crypto and that is just the beginning of its ambitions and its ties to Wall Street and the Federal Reserve.
The extent of Circles, ambitions is perhaps most apparent from its plans to go public plans which have of course been put on hold for now.
So in case you didn’t know going public, especially in the US is a huge deal as it opens the door to potentially billions of dollars of investment from well the public all but a handful of the world’s biggest companies are publicly listed for this reason.
But the fun fact some of the biggest companies that remain in private hands are accounting giant Deloitte MArs the maker of mars bars and M and M’s Ikea and lego.
It also suggests that it could well become the company behind a future U. S. Central Bank digital currency.
Lego the most well-known crypto company to have gone public so far is, of course, coin base and even though its shares haven’t proved a great investment since it launched last year the move has nevertheless catapulted the exchange to a whole new level.
Despite the bear market hammering coin basis stock valuation other Crypto companies including Kraken Bit Fury and ripple are thought to be keen to go down the same route.
Maybe once things have picked up a little bit chaps and spoiler alert it seems to be the bear market that’s largely responsible for the circles’ decision to put going public on hold.
It had planned to go public via what’s known as a special purpose acquisition company or SPAC according to Investopedia.
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What is SPAC?
A SPAC is defined as quoting a shell company formed to raise capital to acquire an existing company. Now SPACs are sometimes referred to as blank check companies and often won’t even state which companies they’re looking to acquire.
You’ll sometimes see stacks described on stock investing platforms as looking to partner with a company in the X Y or Z sector or something equally vague.
Now the main advantage of going public this way is the fact that it can considerably cheapen and speed up the whole process.
The SPAC raises capital from investors usually a share goes public and then acquires its target company thereby taking it public now packs themselves are nothing new.
But have exploded in popularity over the past couple of years in part because they can present tempting opportunities for investors to get early exposure to promising companies before they list recent companies to have gone public this way are virgins galactic and wannabe electric van maker arrival.
A glance at the share price of either will tell you. That’s packs can be pretty high-risk investment vehicles.
well-known exchange Etoro was also looking to go public virus back but that deal fell through all which brings us full circle back to the circle.
It was due to go public via a SPAC called Concord acquisition Corp which is backed by a former Ceo of Barclays bank.
That deal is now dead apparently by mutual agreement between Concord and circle despite a potential valuation of up to $ billion Jeremy Allaire Circle’s CEO said quote we are disappointed the proposed transaction timed out.
However, becoming a public company remains part of the circle’s core strategy. Now this timing out appears to be in reference to an absence of regulatory approval from none other than our friends at the SEc though when pressed on this on CNBC’s tech check jeremy remained tight-lipped as to why exactly the SEc hadn’t approved the merger between Concord and Circle.
What is SEC?
The U.S. Securities and Exchange Commission is an independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary purpose of the SEC is to enforce the law against market manipulation.
An article in decrypt meanwhile quoted a Circle Insider saying quote the merger could not be Consummated before the exploration of the transaction agreement as the SEc has yet to declare the S four registration statement effective.
So it’s the SEc fault, right?
The cold dead hand of Gary Gensler strikes again. Well believe it or not but that might be a bit unfair on the SEc Not something you’ll hear me say very often the real culprit in all of this is ultimately the current crypto bear market and the recent goings on at FTX.
It’s all SBS’s fault. Now, this may sound trite but it is worth bearing in mind that Selena is the official Blockchain of USDC and salons’ exposure to FTX and Alameda could well have set alarm bells ringing at both circle and the sec.
Regardless this just isn’t a good time to be trying to take a crypto company public. Even if that company is apparently in robust financial health and enjoying plenty of high-profile backing.
We’re all well aware of how the sec feels about crypto in general and a reluctance to sanction a big industry player being unleashed on the public is not exactly surprising.
Moreover has been a terrible year for stacks of all types more generally. Even so, this won’t be the end of the story for circles’ bid for crypto domination.
As Jeremy said,
the dream of going public is still alive and SPAC or no SPAC we won’t have heard the end of this tale.
So keep your eyes peeled because if you see news that circles going public is back on chances are the bull market won’t be far behind,