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Cryptopolitan 2025-06-21 13:40:50

Circle employees deal with $3B loss despite aggressive CRCL 700% surge

Circle employees are grappling with a staggering $3 billion loss, even as the stock has soared 700% since its IPO earlier this month. The loss is tied to the 14.4 million shares employees were required to sell during the offering to facilitate the public listing. Billionaire investor Chamath Palihapitiya confirmed: In order to get the IPO off, the team at Circle had to sell 14.4M shares at the IPO price of $31 for total proceeds of $ 446 M. These shares were ‘bought’ by the IPO bank and then sold to their best clients. Chamath Palihapitiya Investor Palihapitiya believes a SPAC merger would have been better for Circle In just 15 days, Circle’s market cap was close to surpassing the $50 billion mark , following the huge spike in stock. However, employees have had to part with about $3 billion over the required share sell-off in the same period. As part of the IPO process, the USDC stablecoin issuer sold 14.4M shares, now valued at $3.456 B. Palihapitiya hoped the company would opt for a SPAC merger rather than the traditional IPO listing. He argued that, as much as the company disapproves of SPAC founder promotions or other forms of value transfer to intermediaries, traditional IPOs have value moved to arbitrary parties, which, in his words, “makes no sense.” He added that the benefits of SPACs and direct listings are clearly laid out from the start, which can be negotiated and optimized to serve the interests of selling and buying shareholders, unlike traditional IPOs. He stated that banks show more opacity with IPOs, and the media only adds to the problem by celebrating first-day stock jumps, which is sometimes not a great sign. He suggested it could indicate the deal was mispriced, allowing banks to hand out free stock to their top clients, many of whom had no connection to the company. Like with the case of Circle , the $3 billion went to unknown people who had nothing to do with the company, its employees, or investors. More companies are opting for SPAC mergers, including SRM Entertainment Recently, Tron Founder Justin Sun revealed his partnership with SRM Entertainment, opting for a SPAC merger rather than going through a conventional IPO. SRM Entertainment is set to change to Tron Inc., with some reports suggesting that Dominari Securities—a boutique investment bank linked to former President Donald Trump—will oversee the reverse merger. SRM Entertainment also confirmed that they agreed on a $100 million equity investment and that it would issue preferred shares and warrants that could raise the deal’s value to about $210 million. The company also stated that its gains will be directed to a Tron Reserve. Earlier this month, Parataxis Holdings , a BTC investment platform, announced it would go public through a SPAC merger with SilverBox Corp IV. The merger would help the company focus on institutional-grade Bitcoin and increase its appeal in public markets. Joe Reece, co-managing partner at SilverBox Capital, asserted that their collaboration would bring a unique and highly scalable digital asset management platform to the public markets. Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now

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