Circle, the company behind the USDC stablecoin, doubles its valuation to $9 billion

Circle, the company behind the USDC stablecoin, has doubled its valuation to $9 billion following a new deal with blank check firm Concord Acquisition Corp.

The two companies first revealed plans to merge in July, in a deal that at the time valued Circle at just $4.5 billion. They have now updated the terms of the deal to reflect improvements in the company’s financial outlook and competitive position.

Circle CEO Jeremy Allaire told CNBC’s “Crypto World” that although the company is ready to go public, the process of obtaining the necessary approvals from the Securities and Exchange Commission has taken longer. provided that. Indeed, in an earlier deal, the companies feared they might not merge in time for the April 3 deadline. This new agreement replaces the previous agreement – and gives them more time to complete the combination.

“We have an SEC qualifying process that we’re going through, we’ve been through multiple rounds of commentary on this and it’s just taking longer,” Allaire said. He added that the extra time is necessary for a new business and a new industry, and if approved, Circle will be better off for it down the line.

“The SEC is doing its job,” Allaire said. “There are a lot of inherent risks in this space…as a company that wants to be trustworthy, transparent and accountable, being a public company really helps with that. SEC is a key part of that.”

Circle may be twice as expensive for Concord shareholders, with SPAC planning to make it public, but Allaire said he sees it as a testament to what his company is building.

He also said that although several SPACs, or Special Purpose Acquisition Companies, have been canceled recently, he is confident that this updated plan will come to fruition. The deal has an initial deadline of Dec. 8, with an option to extend until Jan. 31 next year, Allaire said.

Stablecoins are digital currencies designed to be less volatile than cryptocurrencies by pegging their market value to an outside asset like the US dollar. This makes them potential bridging currencies between volatile crypto assets and more stable traditional assets.

Circle’s stablecoin, USDC, has grown in reach and popularity over the past year. For example, Mastercard last summer said it was piloting a program that would use USDC to enable cryptocurrency payments between cardholders and merchants.

However, stablecoins have come under pressure in recent months from US regulators concerned about their ability to threaten financial stability, by increasing the interconnectedness between the regulated financial system and crypto markets.

Earlier this week, New Jersey Rep. Josh Gottheimer unveiled a first bill to place definitions around stablecoins. In November, the Biden administration urged Congress to regulate stablecoins to ensure they pose no systemic risk.

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