Circle (company) explained

Circle (legally Circle Internet Financial Limited) is a peer-to-peer payments technology company that now manages stablecoin USDC, a cryptocurrency the value of which is pegged to the U.S. dollar. It was founded by Jeremy Allaire and Sean Neville in October 2013. Circle is headquartered in Boston, Massachusetts.[1] [2] USDC, the second largest stablecoin worldwide, is designed to hold at or near a stable price of $1. The majority of its stablecoin collateral is held in short-term U.S. government securities.[3]

Funding

The company has received over million in venture capital from 4 rounds of investments from 2013 to 2016, including million led by Goldman Sachs.[4] [5] [6] In April 2015 The New York Times reporter Nathaniel Popper wrote that the Goldman Sachs investment "should help solidify Bitcoin’s reputation as a technology that serious financial firms can work with."[7] In June 2016, Circle raised US$60 million in Series D funding backed by new and existing partners.[8] On May 15, 2018, Circle raised US$110 million in venture capital to create USD Coin, an Ethereum coin they claim is backed by USD.[9] Today, each USDC token is backed by USD.

In November 2021 Circle led a million funding round in crowdfunding platform Crowdcube.[10]

In April 2022, Circle Internet Financial announced an agreement for a M funding round with investments from BlackRock, Fidelity Investments, Marshall Wace LLP, Fin Capital and Clidenor Capital expected to close in the second quarter.[11]

In January 2024, the company filed for a U.S. Initial public offering.[12] [13]

History

In September 2015, Circle received the first BitLicense issued from the New York State Department of Financial Services.[14] [15] [16] In April 2016, the British government approved the first virtual currency licensure to Circle.[17]

Circle's mobile payment platform, Circle Pay, allowed users to hold, send, and receive traditional fiat currencies,[18] until being slated for discontinuation in 2019. Up until December 2016, Circle Pay also operated as a Bitcoin wallet service to buy and sell Bitcoins.[19] [20] [21] It has since ceased to provide such service.[22]

In September 2018, Circle, along with Coinbase Global,[23] released a consortium called Centre, which launched digital USDC pegged to the dollar. Centre was intended to serve as a platform for users to make deposits from traditional bank accounts and convert fiat currency into tokens. Centre would also provide the ability to shift back to banknotes.[24] In August 2023, Coinbase and Circle closed the Centre Consortium, giving Circle sole governance of USDC.

In February 2020, Circle sold its digital asset trading platform to Voyager Digital.[25] [26]

In July 2021, Circle announced a plan to merge with a special-purpose acquisition company called Concord Acquisition Corp in a $4.5 billion deal that would make Circle a public company.[27] However, in December 2022 this deal was terminated.[28]

In 2023, at the World Economic Forum's annual meeting in Davos, Switzerland, Allaire said the United States needs new statutory definitions of digital assets to provide regulatory clarity. He also said he hoped Circle will be regulated by the U.S. Federal Reserve and become an established financial player in order to distinguish the company from recent implosions in the crypto industry.[29] [30]

On March 10, 2023, USDC Stablecoin announced that $3.3 billion of its US$40 billion Coin reserves were held at Silicon Valley Bank when it collapsed.[31] All of the cash held as reserve has since been parked with The Bank of New York Mellon Corporation.[32] In late 2023, the company announced it had a $1 billion cash cushion.[33] In the same month, the company announced that it had chosen Paris to develop its commercial activities in Europe.[34] [35]

In 2023, CEO Jeremy Allaire began lobbying the U.S. Congress to provide clear rules for stablecoins. Analysts have suggested that well-regulated stablecoins would invite competition from mainstream banks and have the potential to disrupt the current remittance, payments, and peer-to-peer transfer system. In late, 2023, Coinbase took an equity stake in the company which also announced that USDC will be available on six additional blockchains.[36] Visa also announced it was expanding a pilot program that uses USDC on the Solana blockchain to help pay some merchants in cryptocurrency.[37]

In February 2024, Circle announced it would stop supporting USDC token on the Tron network.[38] [39]

According to data compiled by Visa, USDC overtook Tether in stablecoin transaction volume in 2024.[40]

Services and features

As of 2015, a Circle account could be funded in USD via "US-issued Visa and MasterCard credit and debit cards" and US bank accounts.[41] As of 2016, European customers can also use Circle in EUR and GBP.[42] Circle plans to peg the conversion rate to the US Dollar.[43] [44] Britain's Financial Conduct Authority granted Circle an electronic money license in April 2016, expanding the use of Circle's services to the United Kingdom and broadening Circle's relationship with UK bank Barclays.[45] In June 2016, Circle announced it will begin expanding its services to China.[46]

In December 2016 the Circle app stopped supporting the exchange of bitcoin but still allows money transfers.[47] In October 2017, Circle launched a new service for group payments and cash transfers to US accounts.[48] [49]

In June 2019 it was announced that the Circle Pay mobile and web apps would be discontinued on September 30, 2019.[50]

In 2023, the company released a protocol that enables users to move USDC between blockchains. It also unveiled a programmable Web3 wallet platform that will enable applications to store, send, and receive cryptocurrencies.

Acquisitions

On February 26, 2018, Circle announced that they purchased the Poloniex cryptocurrency exchange for $400 million.[51] [52]

In October 2018 it was announced that Circle planned to acquire SeedInvest, subject to FINRA (Financial Industry Regulatory Authority) approval.[53] The acquisition was finalized in March 2019.[54] [55]

In October 2019, Circle and Poloniex announced they were splitting and Poloniex announced itself as a new company, “Polo Digital Asset".[56] It was revealed one month later that Justin Sun, the founder of Tron, led the acquisition of Poloniex.[57]

Licenses

The company has licenses in 49 U.S. states as well as Puerto Rico and the District of Columbia and does most of its banking with regulated U.S. institutions. in 2023, the company received a Major Payment Institution license from the Monetary Authority of Singapore.[58]

Notes and References

  1. Web site: Circle Internet Financial, Inc.: Private Company Information - Businessweek . 2016-04-13 . Bloomberg.
  2. Web site: Aaron . Pressman . December 17, 2022 . Amid crypto crash, Boston's Jeremy Allaire may be the last person standing . 2023-03-20 . BostonGlobe.com . en-US.
  3. Web site: Bambysheva . Nina . Circle Begs Congress: Please Regulate Us . 2023-06-12 . Forbes . en.
  4. News: Alden . William . Dealbook: Startup Unveils Bitcoin Payments Product . The New York Times . March 26, 2014 . April 18, 2014.
  5. Web site: Bitcoin startup Circle raises $50 million from Goldman Sachs and IDG. Stan . Schroeder. April 30, 2015. Mashable. 23 Oct 2018.
  6. News: Goldman a Lead Investor in Funding Round for Bitcoin Startup Circle. Michael J. . Casey. April 30, 2015. Wall Street Journal. 23 Oct 2018.
  7. News: Nathaniel . Popper . Dealbook: Goldman and IDG Put $50 Million to Work in a Bitcoin Company . The New York Times . April 30, 2015 . 23 Oct 2018.
  8. Web site: Circle Raises $60 Million in Funding Round Backed by Baidu, IDG. Wang. Selina . Bloomberg. 2016-06-23. 23 Oct 2018.
  9. News: Cryptocurrency Startup Circle Raised $110M For Ethereum Coin Backed By U.S. Dollars. Castillo. Michael del. Forbes. 2018-05-16. en. 15 May 2018.
  10. Web site: Crowdcube raises £10m to power European expansion . 25 July 2022 . AltFi.
  11. Web site: Circle Announces $400M Funding Round . www.prnewswire.com . en . 12 April 2022.
  12. Web site: Circle confidentially files for US IPO . Reuters.
  13. Web site: Sigalos . MacKenzie . 2024-01-11 . Circle confidentially files for IPO following banner year for crypto stocks . 2024-03-18 . CNBC . en.
  14. Web site: Moneybeat: Circle Gets First 'BitLicense,' Releases CirclePay, New Service. Paul . Vigna. September 22, 2015. Wall Street Journal. 23 Oct 2018.
  15. Web site: Circle gets first bitcoin license from New York regulators. Curt. Woodward. September 22, 2015. beta Boston. 23 Oct 2018. 23 September 2015. https://web.archive.org/web/20150923173720/http://www.betaboston.com/news/2015/09/22/circle-gets-first-bitcoin-license-from-new-york-regulators/. dead.
  16. Web site: NYDFS Announces Approval of First BitLicense Application from a Virtual Currency From a Virtual Currency Firm. press release. NYDFS. September 22, 2015. ny.gov. 23 Oct 2018. https://web.archive.org/web/20180131023602/http://www.dfs.ny.gov/about/press/pr1509221.htm. 31 January 2018. dead.
  17. News: Bitcoin Start-Up Gets an Electronic Money License in Britain. Popper. Nathaniel. 2016-04-06. The New York Times. 0362-4331. 23 Oct 2018.
  18. Web site: Circle's bitcoin app now lets you send cash. beta Boston. en-US. 2016-04-13. Nidhi Subbaraman. 25 Sep 2015. 2015-09-29. https://web.archive.org/web/20150929013206/http://www.betaboston.com/news/2015/09/25/circles-bitcoin-app-now-lets-you-send-cash/. dead.
  19. This Digital Wallet Could Finally Get You Into Bitcoin. Alba. Davey. Davey Alba. April 30, 2015. WIRED. 23 Oct 2018.
  20. News: Digital currency firm gets $17m in financing. Alspach. Kyle. March 27, 2014. The Boston Globe. April 18, 2014.
  21. News: Still More Bitcoin Investing: Circle Internet Financial Raises $17 Million from Oak, Others. Swisher. Kara. Kara Swisher. March 26, 2014. re/code. April 18, 2014.
  22. Web site: Spark, New Markets, App Messaging, and Bitcoin Changes . Sean Neville. Jeremy Allaire. 2016-12-06 . The Circle Blog . 2017-06-06 . 2016-12-08 . https://web.archive.org/web/20161208151207/http://blog.circle.com/2016/12/06/spark-new-markets-app-messaging-and-bitcoin-changes/ . dead.
  23. Web site: Circle wanted to create a financial revolution. Instead, it’s losing the stablecoin wars to Tether . 2023-11-13 . Fortune Crypto . en.
  24. News: 2018-09-26 . Circle Joins Ranks of Stable Crypto Coins With Dollar Token . en . Bloomberg.com . 2023-11-13.
  25. Web site: 2020-02-12 . Circle Spins Out More Business, Sells ‘Invest’ to Voyager Digital . 2024-04-16 . Financial and Business News Finance Magnates . en.
  26. News: Circle Sells Crypto Investing App Business to Voyager Digital . Bloomberg.com . 12 February 2020.
  27. News: Vigna . Paul . 2021-07-08 . Cryptocurrency Operator Circle to Go Public in $4.5 Billion SPAC Merger . en-US . Wall Street Journal . 2021-07-28 . 0099-9660.
  28. News: 2022-12-05 . Crypto group Circle ends $9bn deal to go public through Bob Diamond's Spac . Financial Times . 2022-12-05.
  29. Web site: Crypto Presence Endures at Davos . 2023-02-14 . WSJ . en.
  30. News: Chowdhury . Divya . Mattackal . Lisa Pauline . 2023-01-16 . Davos 2023 New regulatory definitions needed for digital assets -Circle CEO . en . Reuters . 2023-02-14.
  31. https://www.bloomberg.com/news/articles/2023-03-10/binance-tether-say-no-svb-exposure-while-circle-stays-mum Stablecoin Firm Circle Reveals $3.3 Billion Exposure to Silicon Valley Bank
  32. News: 2023-03-16 . US Bank Crisis Prompts Stablecoin Backer's Flight to Big Lenders . en . Bloomberg.com . 2023-03-20.
  33. News: 2023-08-10 . Circle Says $1 Billion in Cash Serves as Buffer While Market Share Declines . en . Bloomberg.com . 2023-09-19.
  34. News: 2023-03-21 . " Le géant des stablecoins Circle choisit Paris pour établir son siège européen " . fr . bfmtv.com . 2023-03-29.
  35. News: 2023-03-21 . Circle Picks Crypto-Friendly France for European Headquarters . En . 2023-03-29.
  36. Web site: USDC to be available on 15 blockchains after adding 6—including Base, Optimism, and Polygon PoS—over next 2 months . 2023-09-19 . Fortune Crypto . en.
  37. Web site: Visa to send stablecoin USDC over Solana to help pay merchants in crypto . 2023-09-19 . Fortune Crypto . en.
  38. Web site: Stablecoin USDC Ditches Tron Network, Cites Risk Management . 2024-03-21 . www.bloomberg.com.
  39. Web site: Wilson . Tom . 2024-02-21 . Crypto firm Circle to end support for USDC stablecoin on Tron blockchai .
  40. News: Shukla . Sidhartha . April 29, 2024 . Circle’s USDC Takes Lead in Stablecoin Transactions, Visa Says . Bloomberg.
  41. Web site: Which debit and credit cards can I use?. Circle FAQ. 15 December 2015. https://web.archive.org/web/20151222092944/https://support.circle.com/hc/en-us/articles/205382324-Which-debit-and-credit-cards-can-I-use-. 22 December 2015. dead.
  42. Web site: Circle and British Pound Sterling, Social Payment App Updates, Limitless Spends and Withdrawals. 2016-04-05. The Circle Blog. 2017-06-06.
  43. Web site: Anna Irrera . Circle raises $110 million, plans to create dollar-pegged cryptocurrency . Reuters . 25 Oct 2018 . 15 May 2018.
  44. Web site: Kate Rooney . Goldman Sachs-backed start-up Circle introducing a crypto version of the US dollar . CNBC . 25 Oct 2018 . 15 May 2018.
  45. News: Bitcoin Start-Up Gets an Electronic Money License in Britain. Popper. Nathaniel. 2016-04-06. The New York Times. 0362-4331. 2016-04-06.
  46. Web site: Dublin-listed Circle gets €54m for China expansion.
  47. Web site: Circle removes ability to buy and sell Bitcoin as it doubles down on mobile payments. en-US. 2017-02-07. Fitz Tepper. TechCrunch. 12 Jul 2016.
  48. News: Dublin payments firm debuts group transfers - Independent.ie. Independent.ie. 2017-10-19. en . Adrian Weckler . 19 Oct 2017.
  49. News: Circle reveals group payments and fast, free cash transfers to US accounts. Kennedy. John. 2017-10-19. Silicon Republic. 2017-10-19. en-GB.
  50. Web site: 17 June 2019 . Circle Pay Pulls Out of the Mobile Payments Market .
  51. Web site: Robert Hackett . This Big Cryptocurrency Acquisition Could Create a Wall Street-Style Financial Giant . Fortune . 24 October 2018 . 26 Feb 2018 . 26 February 2018 . https://web.archive.org/web/20180226142013/http://fortune.com/2018/02/26/circle-cryptocurrency-trade-bitcoin/ . dead.
  52. Web site: Romain Dillet . Circle acquires cryptocurrency exchange Poloniex . TechCrunch . 28 January 2020 . February 26, 2018.
  53. Web site: Lily Katz . 5 Oct 2018 . Circle to Buy SeedInvest to Help Startups Raise Cash With Crypto . 25 October 2018 . Bloomberg.
  54. Web site: 2019-03-04 . Crypto Payments Firm Circle Closes Acquisition of Crowdfunding Platform SeedInvest . 2024-04-22 . Yahoo News . en-US.
  55. Web site: PYMNTS . 2019-03-04 . Circle Pay Closes On Acquisition Of SeedInvest . 2024-04-22 . PYMNTS.com . en-US.
  56. Web site: 2019-10-18 . Circle spinning out Poloniex; new exchange plans to spend $100M and not serve US clients . 2024-03-25 . uk.movies.yahoo.com . en-GB.
  57. Web site: Poloniex Exchange on Twitter. twitter.com . 17 December 2020.
  58. Web site: Circle Singapore Gets Digital Payment Token License From MAS . 2023-06-12 . news.bloomberglaw.com . en.

This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Circle (company)".

Except where otherwise indicated, Everything.Explained.Today is © Copyright 2009-2024, A B Cryer, All Rights Reserved. Cookie policy.