Circle, the world's second-largest stablecoin operator of USDC, has reportedly been unofficially exploring the possibility of halting its IPO and selling to Coinbase or Ripple.
According to blockchain media Cryptopolitan on the 19th (local time), Circle submitted its IPO documents in early April this year but has been reportedly reaching out to Coinbase and Ripple with a proposal while keeping the sale option open, without substantial progress. Circle aims for a corporate value of around $5 billion.
Superficially Pursuing IPO... In Reality, Just a 'Plan'
While Circle continues to officially express its intention to pursue an IPO, there are no substantial activities such as roadshows or investor attraction. The industry views the IPO plan skeptically, suggesting it might remain "just a paper concept".
Coinbase and Circle, 'Essentially One Body'
Circle and Coinbase have maintained a close cooperative relationship for a long time. The two companies established the Centre Consortium in 2018 to jointly issue USDC, and continue to maintain a share ownership and profit-sharing system even after their official cooperation ended.
50% of the interest income from USDC deposits is divided between Circle and Coinbase, and especially when USDC is stored on Coinbase, the entire interest becomes Coinbase's share. In fact, recent Coinbase financial reports show they are generating significant revenue due to the increased proportion of USDC deposits on their platform.
Moreover, if Circle goes bankrupt, Coinbase has the right to partially own Circle's intellectual property (IP). An industry insider emphasized their close relationship, stating it's "almost like an internal organization".
Ripple's Acquisition Proposal... Circle Rejects XRP Inclusion
Meanwhile, Ripple is reported to have delivered an acquisition proposal to Circle worth approximately $4-5 billion. The proposal included XRP, their issued cryptocurrency, in addition to cash. However, Circle is said to have rejected this proposal.
As of the first quarter of 2025, Ripple is circulating about 456 million XRP (approximately $1.177 billion) and holds 37.13 billion XRP (equivalent to about $95.7 billion) in escrow. The possibility is raised that Circle may have been concerned about risks, given that XRP still faces regulatory issues.
Coinbase Advantageous in Cash and Market Accessibility
As a listed company, Coinbase has excellent funding flexibility. Currently holding $800 million in cash and capable of raising funds through stocks or bonds, they have a relative advantage in securing the necessary funds for acquiring Circle.
Brian Armstrong, Coinbase CEO, stated that "the commercial relationship with Circle is independent of the IPO pursuit" and that there are "no additional plans to announce at this point", but he did not completely rule out future M&A possibilities.
Both Companies Expanding Aggressive Investments
Recently, Coinbase and Ripple have been expanding their market dominance through large acquisitions. Ripple acquired crypto prime brokerage Hidden Road for $1.25 billion earlier this year, while Coinbase drew attention by acquiring the crypto derivatives exchange Deribit for $2.9 billion. Beyond these, both companies are investing in various Web3 projects like Iron Fish and Spindle, intensifying their battle for blockchain market leadership.
