Circle Was Underpriced
Olivia Capozzalo & Camila Russo
June 06, 2025
gm Defiers!
Today’s big story:
- Circle’s NYSE debut was a huge success, but almost $2B was left on the table
Plus:
- Markets remain volatile on macro uncertainty and Trump-Musk feud
- Polymarket becomes the official prediction market of X
- Big Tech giants are exploring stablecoin integration
- World Liberty Financial takes legal action against TRUMP memecoin team
- DNA fund CEO Chris Miglino details shift from ETH & Tether to a $50M bet on decentralized AI [MEDIA PARTNERSHIP]
- Andrew McFarlane of Validation Cloud shares how they’re building the backbone of web3 [MEDIA PARTNERSHIP]
Read more below! But first, please give our sponsors some love; they make this newsletter possible.
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We’re back! Here’s what you need to know in web3 today
Once Again, Wall St. Underestimated Crypto
Circle’s IPO clawed its way into the record books as one of the most successful listings in recent memory: It was the first to experience a 200% intraday gain on its first day of trading in more than four years, and had the largest first-day surge for a billion-dollar IPO in over three decades.
However, the flip side to those blockbuster headlines is that investment banks tasked with pricing the deal clearly underestimated demand, which means they cost Circle a significant amount of money.
Circle sold 34 million shares at $31 apiece, raising about $1.05 billion in fresh capital. Yet, by the close of trading yesterday, that $31 price tag looked laughably low. Shares ended up near $83, implying that roughly $1.78 billion was left on the table – more money than they raised! The stock is trading up over 39% to $115 at the time of writing.
Circle’s underwriters – J.P. Morgan, Citigroup, and Goldman Sachs – had pitched the IPO at a valuation of roughly $6.9 billion, only to see the market confect a post-debut valuation approaching $19 billion.
Those banks fielded a staggering 25 times more demand than the 34 million shares on offer, forcing them to ration allocations to institutions large and small. Notably, Arca CIO Jeff Dorman, for example, placed a $10 million order but received only a $135,000 allocation, prompting him to write an f-bomb-ridden letter to Circle CEO Jeremy Allaire (which he later deleted).
Why did Wall Street get this so wrong? The answer lies in the fact that until now, there had been no publicly listed stablecoin companies, and bankers underestimated the pent-up demand for exposure to that sector.
More Volume than Visa
Demand is there because stablecoins have been the most successful use case in crypto, period. I’d argue that it’s the highest-growth sector in all of fintech. USDC alone processed $5.9 trillion in on-chain transactions in Q1 2025—annualize that, and you’ve got $24 trillion, which dwarfs Visa’s roughly $15 trillion in network volume. Tether (USDT) adds even more heft, bringing the total stablecoin market cap north of $250 billion.
Meanwhile, all major fintech players are incorporating stablecoins, from Stripe, which recently enabled businesses in 101 countries to hold and transact in USDC, to Revolut, which supports USDC and USDT and is planning to launch its own stable, to PayPal, which already does have its own coin (PYUSD).
And it’s not just fintech. Stablecoins are becoming the payment rails of the web. Just today, Fortune reported citing people familiar that Apple, X, Airbnb and Google are all holding early conversations with crypto firms about integrating stablecoins. Uber’s CEO said they’re “in the study phase” of using stablecoins to move money more cheaply.
It’s always been obvious that finance should run on blockchain rails. And now it's starting to feel like that trickle of early experimentation is turning into a tidal wave of actual adoption – of course, investors want in on that growth.
Not just stablecoin companies will be able to cash in, and apparently, Gemini has taken note. The exchange has confidentially filed its own draft S-1, spurred on by Circle’s meteoric debut.
As a side note, if there is an actual surge in crypto IPOs, all these crypto treasury plays from companies not actually producing anything blockchain-related might seem less attractive.
In any case, Circle's IPO showed investors are bullish on stablecoins, and unlike many oversubscribed IPOs, there are actual fundamentals behind this hype.
With love,
Cami, founder of The Defiant
📈 Markets in the last 24 hrs:
| TICKER | VALUE | 24H | |
|---|---|---|---|
 | Bitcoin | $104,445 | 3.02 % |
 | Ethereum | $2,493.9 | 2.58 % |
 | XRP | $2.18 | 3.87 % |
 | BNB | $645.88 | 1.91 % |
 | Solana | $149.38 | 4.01 % |
 MessariPortals | MINDSHARE Rank | MINDSHARE % Change (7d) |
|---|---|---|
 Solana SOL | 6  | 41.55% |
 Avalanche AVAX | 20 | 28.95% |
 TRON TRX | 8  | -19.81% |
| Powered by Messari Portals | ||
This is the news that mattered in the past 24 hrs:
- Crypto markets remain volatile today, following the release of U.S. employment data — the weakest monthly report since March 2023 — and a viral feud between President Donald Trump and Tesla CEO Elon Musk.
- X (formerly Twitter) announced that it’s partnering with crypto-powered prediction market Polymarket, which first got mainstream attention during the 2024 U.S. presidential election.
- U.S. tech giants Apple, Airbnb, X, and Google are all exploring stablecoin integration for payments, sources told Fortune; Uber’s CEO recently said that the firm is also looking into stablecoins for more efficient global payments.
- The Trump family’s DeFi firm, World Liberty Financial, reportedly sent a cease-and-desist letter to the company behind the TRUMP memecoin about its intentions to launch a Trump-branded crypto wallet; NFT marketplace Magic Eden announced a day earlier that it was the official partner of the planned wallet.
🎬WATCH
In the latest episode of The Defiant Podcast, we spoke with Rob Viglione, co-founder and CEO of Horizen Labs, to explore the groundbreaking potential of zero knowledge proofs.
From balancing transparency and on-chain privacy to the intersection of AI and web3, Rob dives into the critical role of cryptography in reshaping how we share and protect data.
That’s it for today — if you enjoyed this newsletter, tell your friends! https://thedefiant.io/subscribe
