The circle’s public debut attracted criticism from well-known investors, particularly for the possibility that early employees may have missed nearly $3 billion in unrealized profits.
Billionaire venture capitalist Chamas Parihapitiya noted that Circle Insider has sold 14.4 million shares at an initial public offering (IPO) price of $31 each, securing about $446 million. However, with the stock currently exceeding $240, the same stock is currently worth around $3.45 billion.
Circle IPO leaves billions at the table for early employees
This difference shows a gap of nearly $3 billion. This describes Palihapitiya as a costly misstep caused by the selection of traditional IPO routes.
He noted that the underwriters purchased insider shares and redistributed them to their selected clients, leaving a limited advantage to the original shareholders.
In his view, employees essentially handed billions of dollars to outside investors who didn’t play a role in the success of the circle.
“In this case, it was a $3 billion gift from circle employees and investors to people they don’t know.
Palihapitiya argued that the situation could have exerted a different form if Circle chose a merger or direct list of special purpose acquisition companies (SPACs).
These alternative routes often help insiders maintain more value during the public transition, with more control over pricing, timing and disclosure.
He added that SPACS and direct listing can be configured to disclose valuation dynamics more clearly and benefit both sellers and buyers.
“To be clear, this value transfer method does not occur directly in lists or SPACs. The benefits of SPACS and DLS are highly explicitly disclosed in advance. You can negotiate, minimize, etc. for the benefit of shareholder sales or shareholder purchases,” he added.
The circle had previously planned to make it public via SPAC merger with Concord Accisition Corp, but cancelled the deal in 2022. Later, the company pursued traditional IPOs.
As Stablecoin’s trust grows, CRCLs will skyrocket
Despite the controversy, the circle’s performance in the public market is incredible.
Stocks currently trading under Ticker CRCL have skyrocketed over 675% since their debut $31, reaching a peak of $248 per share on June 20th.
Jon MA, CEO of Blockchain Analytics Firm Artemis, noted that Circle is trading in the circle that despite reporting higher net profits, it far outweighs the valuation of Coinbase and Robinhood.
“The circle is currently trading: 24.2x (ITS) Q1’25 revenue mileage, 60.7x Q1’25 gross profit mileage (and) 216x Q1’25 net profit mileage,” MA pointed out.
According to him, the premium is likely to reflect investors’ beliefs about the circle’s future growth and potential regulatory advantages.
The key factor behind that optimism is the recent passing of the Senate genius law. This is a bipartisan bill designed to bring stubline clarity to the US market. Laws supported by President Donald Trump still require approval and final signature from the House.
If passed, it could help to cement the circle’s regulatory foothold, strengthen control in the stubcoin sector and justify rising stock prices.
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