USDC Stablecoin Operator Circle's New SPAC Deal Doubles Valuation To $9 Billion

KEY POINTS

Circle has agreed to a new SPAC merger with Concord Acquisition
The new deal values Circle at $9 billion, more than double its previous valuation
The deal will take effect in December
The combined entity will be listed on the NYSE under the ticker symbol CRCL

Circle, the company that issues the USDC stablecoin, said it has agreed to a revised merger deal with SPAC Concord Acquisition, which values it at $9 billion, double its valuaiton under a previous deal.

The initial agreement with Concord, made in July 2021, that valued Circle at $4.5 billion has now been terminated, Circle said in a statement Thursday.

"The increase in value reflects improvements in Circle's financial outlook and competitive position – particularly the growth and market share of USDC, one of the fastest growing dollar digital currencies. USDC's circulation has more than doubled since the original deal was announced," it said. USDC's circulation reached $52.7 billion on Thursday.

Circle announced last summer that it planned to go public by the end of 2021 through a merger with a Special Purpose Acquisition Company (SPAC) called Concord Acquisition. SPACs go public as shell companies and then acquire and merge target companies to bring them public, thus circumventing the traditional initial public offering process.

According to the new SPAC agreement, a single holding company will buy both Circle and Concord Acquisition in December, with the option to extend the deal until Jan. 31, 2023. After that , the business will be listed on the New York Stock Exchange under the ticker symbol CRCL.

While the value of Circle has more than doubled, Concord Acquisition's market capitalization has remained stable at roughly $360 million since July 2021. This implies that Concord Acquisition's stockholders will earn nearly half of what they would have gotten if the original acquisition had been completed.

Nonetheless, Concord Acquisition's executive team has expressed optimism about the deal. In a news announcement announcing the agreement, Bob Diamond, Chairman of Concord Acquisition Corp, said: "We believe our new deal is attractive because it preserves the ability of Concord's public stakeholders to participate in a transaction with this great company."

By market capitalization, USDC is the world's second-largest stablecoin, only after Tether (USDT).