Stablecoin issuer Circle has decided to relocate its legal base from the Republic of Ireland to the US. This move follows the company filing court paperwork for re-domiciliation and submitting plans for an initial public offering to the US Securities and Exchange Commission (SEC) in January. The IPO is expected to take place after the SEC completes its review process and is subject to market and other conditions. Choosing the US as its new home could mean Circle faces a higher tax burden compared to Ireland’s business-friendly environment and low tax rate of 12.5%.
Since its launch in 2013, Circle has become a major player in the crypto industry, best known for issuing the stablecoin USDC, which is tethered to the US dollar. As of May 2024, USDC has a market cap exceeding $32 billion. The core business of Circle revolves around issuing and managing USDC, which provides stability for transactions in the often volatile cryptocurrency market. Circle’s plan to go public through a traditional IPO follows a failed attempt in 2021 via a special purpose acquisition company (SPAC) merger. The IPO will proceed after SEC approval and is subject to market conditions and other factors.
In January, Circle announced plans to introduce USDC on the Celo network, a Layer-1 blockchain evolving into an Ethereum Layer-2 scaling network. This collaboration aims to leverage Celo’s mobile-centric user community in areas with high blockchain adoption rates. Moving its legal base to the US indicates a strategic shift for Circle to enhance its presence and operations within the US market. While Ireland’s tax perks may be left behind, the move may offer new opportunities and advantages for the company in the US regulatory and business environment.
The decision to relocate to the US signals Circle’s ambition to expand its footprint and reach within the cryptocurrency industry. By opting for a traditional IPO, Circle is taking a different route than its previous attempt through a SPAC merger. The move to the US comes at a time when stablecoins and cryptocurrencies have gained increasing popularity and adoption worldwide. Circle’s USDC stablecoin has played a significant role in providing stability and liquidity in the cryptocurrency market, contributing to the company’s growth and prominence in the industry.
Circle’s collaboration with the Celo network indicates a strategic partnership aimed at tapping into Celo’s user base and expanding the utility and accessibility of USDC. This partnership aligns with Circle’s goal of fostering innovation and driving adoption of stablecoins in various blockchain ecosystems. With the planned IPO and expansion into new networks, Circle is positioned to further solidify its position as a key player in the cryptocurrency space. The move to the US represents a significant milestone for Circle and highlights its commitment to growth and evolution in the rapidly changing crypto landscape.
