Circle Shares Jump 16% as Strong Earnings and $222M Token Buy Fuel Rally

Circle, the stablecoin giant behind USDC, has seen its shares rally after delivering higher Q1 revenue and disclosed a US$222 million (AU$308.6 million) private presale for tokens tied to its Arc blockchain project.

Circle’s Q1 filing showed total revenue and reserve income of US$694 million (AU$964.7 million), up 20% from a year earlier. Net income from continuing operations fell 15% to US$55 million (AU$76.5 million), while adjusted EBITDA rose 24% to US$151 million (AU$209.9 million).

The mixed profit picture did not stop investors from focusing on stablecoin growth and the Arc raise. Circle said USDC on-chain transaction volume reached US$21.5 trillion (AU$29.9 trillion) in Q1, up 263% year over year.

Deposits from stablecoin holders were US$76.78 billion (AU$106.72 billion) at quarter-end, giving Circle a larger reserve base even as expenses rose.

Related: Circle Faces Backlash After Allegedly Freezing Unrelated Crypto Wallets

Circle’s Private Sale

Circle agreed to sell 740 million ARC tokens at US$0.30 each in a private presale, generating about US$222 million (AU$308.6 million) in gross proceeds. The transaction implies a US$3 billion (AU$4.17 billion) fully diluted network valuation for Arc.

a16z led the raise, with participation from institutions including BlackRock, Apollo and ARK.

Arc is part of Circle’s push to expand beyond issuing USDC and into settlement infrastructure for payments, tokenised assets and automated financial applications. The raise gives the company capital and external validation as competition in stablecoin infrastructure increases.

Moreover, the firm also reported US$76.78 billion (AU$106.72 billion) in deposits from stablecoin holders as of March 31. The company reaffirmed its multi-year target for 40% compound annual growth in USDC circulation.

Read more: Circle Unveils cirBTC to Bring Trusted Bitcoin Liquidity Into DeFi