The Boston-based crypto financial firm Circle has announced plans to go public through a merger with Concord Acquisition Corp., a special purpose acquisition company (SPAC) backed by former Barclays CEO Bob Diamond. The deal, revealed on Thursday July 8, 2021, values Circle at $4.5 billion and is expected to close in the fourth quarter of 2021.
A Decade of Building Crypto Infrastructure
Founded in 2013 by Sean Neville and Jeremy Allaire, Circle has become a key player in digital currency payments. The company is best known for co-creating USD Coin (USDC) in partnership with Coinbase and the Centre Consortium. Circle previously owned the crypto exchange Poloniex, which it sold to Voyager Digital in February 2020. In September 2015, Circle became the first company to receive a BitLicense from the New York State Department of Financial Services.
SPAC Deal Details and Leadership
The transaction is expected to generate approximately $691 million in proceeds for the combined entity, including a $100 million PIPE (private investment in public equity) from investors such as Daniel Loeb's Third Point, Ark Investment Management, Marshall Wace, and Fidelity Management & Research Co.
Circle co-founder Jeremy Allaire will remain CEO. Bob Diamond, chairman of Concord Acquisition and former Barclays CEO, will join Circle's board. Speaking on CNBC's Squawk Box, Allaire said: "We just see an incredible opportunity to grow rapidly and grow around the world, and we think that this set of transactions and becoming a public company really sets us up to be a trusted platform in this digital currency industry."
Exponential Growth of USDC
Circle's SEC filing highlighted the rapid adoption of USDC. CFO Jeremy Fox-Geen noted during the investor call: "We have seen growing adoption and usage of USDC across an ever-widening range of use cases. While we believe that the use case for USDC is the same as the use case for a dollar, for many of those use cases, USDC is the better product."
Allaire emphasized Circle's unique position: "We operate this market infrastructure of USDC which doesn’t have a clear comparable. It’s a fundamental innovation in payment systems, so you might think about large payment technology companies."