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- Circle considers selling for $5 billion, with Coinbase and Ripple in talks to acquire the USDC issuer.
- Coinbase’s special partnership with Circle makes it the front-runner for the potential acquisition.
- Ripple’s $4-5 billion offer was rejected, but its XRP reserves may fund a future acquisition bid.
Circle is considering acquisition negotiations with Coinbase, which has been reported by Fortune. Even though Circle’s initial public offering is proceeding, private talks indicate that the company may be interested in selling. Companies might consider buying the $5 billion stablecoin, as it is especially appealing due to its value.
Coinbase is thought to be the favorite candidate for the acquisition. The companies joined forces back in 2018 to establish the Centre Consortium and launch USDC. USDC held on Coinbase earns 100% of the company’s revenue through a special arrangement. This special relationship gives Coinbase an edge in any possible deal with Circle.
Circle is considering selling to Coinbase if they offer suitable terms. The IPO is moving ahead, but there has been no mention of terms or roadshow yet. Nevertheless, an acquisition could still occur, allowing Circle to accelerate its expansion across markets.
Circle’s Acquisition Talks
Ripple has offered to purchase Circle for between $4 billion and $5 billion. However, Circle turned down the offer, giving Ripple an option to use its huge amount of XRP tokens, worth over $100 billion, for any future financing. Despite Ripple’s assets, Coinbase is in a better financial position because it has $8 billion in cash and access to the public stock market.
This year, Coinbase has been more active in merging with and acquiring other companies. By buying companies such as Deribit and Spindle, it has become stronger in the market. According to recent statements by CEO Brian Armstrong, Circle’s entry into the stock market will not hinder existing business relationships, but it could lead to more future business arrangements.
Circle is still prioritizing the IPO, but talks with Coinbase and Ripple indicate that the company might be considering a strategic sale as well. Firm will be able to continue growing in the rapidly developing cryptocurrency space. The company could decide to issue shares or purchase another business, but either option has the potential to help it achieve its goals.
Circle’s IPO and talks about being purchased have put the company in a critical position, as Coinbase and Ripple are both competing for it. Whether Circle continues to operate or changes companies, it’s likely to influence the future of cryptocurrency.
