Circle, the creators and operators of the second most capitalized stablecoin, USDC, has seen its valuation double to $9 billion after the company revised its merger agreement with Concord Acquisition Corp, a special purpose acquisition company (SPAC) founded in 2020.
Circle announced that it had terminated its previous business combination terms with Concord and reached a new agreement that is expected to be finalized by December 8, 2022, with the possibility of it being extended to January 31, 2023.
Circle and Concord first announced their merger plans in July 2021 and a Circle spokesperson explained that the new agreement reflects a commitment from both parties to move the deal forward after it became clear that the original closing date wouldn’t be met.
What they are saying
The spokesperson also stated, “It was clear that the original deal would not be closed within the time parameters of the original business combination agreement (April 3, 2022). As part of the negotiation to extend the deal, the value of Circle was updated to reflect improved financial performance and the competitive position of USDC, along with a new initial outside date, December 8, 2022.”
Consistent with the original agreement, Circle remains committed to becoming a publicly-traded company once the business merger is finalized and a new company is designated. That new company will go on to become a publicly-traded business to be listed on the New York Stock Exchange (NYSE) under the ticker symbol “CRCL.”
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Circle at the beginning of the month saw its market capitalization rise to $50 billion for the first time. Currently, USDC is ranked #5 in terms of market capitalization, as of the time of this writing.
According to the Circle CEO, Jeremy Allaire, the stablecoin network grew by 10,000% over the past two years and has seen $2.5 trillion in on-chain transactions and 4.6 million active wallet addresses in 2021 alone. He also mentioned that the USDC token runs and is currently available on eight different distinct blockchains. He stated that USDC is also supported by 200 protocols and can be traded in more than 180 countries on 34 exchanges. Although Tether’s USDT is still the dominant force in the stablecoin ecosystem, however, the Goldman Sachs-backed digital payment company Circle is closing in fast.
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What you should know
The stablecoin market capitalization currently stands at approximately $180 billion. Tether commands around 43.63% ($78.7 billion) of that total, whereas Circle now takes a 29.15% ($52.6 billion) share as the gap between them closes. When compared to last year, Tether had a dominance of 74% with Circle taking just 16% of the stablecoin pie.
As previously reported by Nairametrics, the USDC supply has already flipped USDT on the Ethereum network. Tether supply is currently split mostly between Ethereum and Tron with around 39 billion and 36 billion USDT on each network respectively and the rest on a handful of others such as Solana, Omni, and Algorand according to its transparency report.