Circle's IPO on hold? Bloomberg: Continued decline in USDC market share may hinder the listing

This is the second time Circle has considered an IPO since 2022, but the market value of USDC has been halved compared to that year.

Circle senses the bullish market and is preparing for another IPO?

USDC Market Value Drops Suddenly, Related to Soaring US Bond Yields?

According to a report by Bloomberg, Kyle Samani, co-founder of the crypto venture capital firm Multicoin Capital, pointed out that USDC has gained widespread adoption in the United States with the promotion on Coinbase. However, with US bond yields soaring to 5%, many holders have chosen to redeem US dollars. He stated:

Most USDC users also have access to US dollar bank accounts, so they naturally convert USDC to USD to earn yields; however, most USDT holders cannot use US dollar accounts, and they are less concerned about US bond yields.

Tether's Market Share Rises to 69%, US Bank Crisis Turning Point

Kyle Samani's remarks are quite rare. It is well known that earlier this year, Circle had 30% of its reserves stuck in Silicon Valley banks, and a series of bank failures once led to USDC being unpegged.

Also, data from CoinMarketCap shows that Circle's market value plummeted in March as if in a straight line, dropping over $10 billion.

In comparison, Tether's market share has grown from 48% at the beginning of the year to 69%, and its market value recently reached a historic high of $8.735 billion.

Circle confirms $3.3 billion stuck in Silicon Valley banks, waiting for FDIC assistance

How Can Circle Regain Market Share?

Bloomberg proposes two points:

1. Make good use of Circle's over $1 billion idle cash.

2. USDC's redemption mechanism is more user-friendly compared to USDT.

Bloomberg quoted Circle's second-quarter financial report, where Allaire claimed to use $1 billion in cash to compete against rivals like PayPal.

Circle's first-half revenue was $779 million, with $1 billion in cash reserves to face competition

Bloomberg pointed out that the minimum amount for USDC redemption is only $100, which is more user-friendly compared to Tether's $100,000 limit.

However, Circle announced earlier this month that Circle Mint will no longer support individual accounts for retail users, which is widely seen as mimicking Tether's minting mechanism. Besides, what benefits does user dollar redemption bring to Circle?

Circle's advantage here is that Circle Mint is free, while Tether charges 0.1% or $1,000.

Circle stops providing services to individual accounts: Enterprise and institutional Circle Mint users can still use it