In early April, Circle Internet Financial, the issuer of the popular crypto stablecoin USDC, filed preliminary documents with the SEC to move forward with a long-awaited initial public offering (IPO). While the company remains publicly committed to going public, behind the scenes, discussions with major players in the cryptocurrency space—namely Coinbase and Ripple—have sparked speculation that Circle could instead be acquired.
According to four sources familiar with the matter, including banking and private equity executives, Circle has engaged in informal talks regarding a potential sale to either Coinbase Global, the largest U.S. crypto exchange, or Ripple, the blockchain payments firm known for its XRP token. These individuals requested anonymity due to the confidential nature of the negotiations.
Circle is reportedly seeking a valuation of at least $5 billion—a figure aligned with its IPO target. However, despite public filings indicating a path toward an IPO, no formal terms have been set, and the roadshow has not yet launched.
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Circle’s Strategic Position in the Crypto Ecosystem
Circle plays a central role in the cryptocurrency market as the issuer of USDC, one of the most widely used dollar-pegged stablecoins. With over $60 billion in circulation as of 2025, USDC is a critical infrastructure component across decentralized finance (DeFi), trading platforms, and cross-border payments.
The company’s deep integration with Coinbase dates back to 2018, when both co-founded the Centre Consortium to jointly manage USDC. Although the formal joint venture concluded in 2023, the partnership remains highly symbiotic. Under current agreements detailed in Circle’s S-1 filing, each company receives 50% of residual interest income generated from USDC’s reserve assets.
However, a key clause gives Coinbase full rights to 100% of that revenue if USDC is held on its own exchange platform—a scenario that has likely increased given Coinbase’s growing user base and rising reported earnings from USDC-related activities.
Additionally, Coinbase holds significant operational influence over Circle. The agreement restricts Circle from entering new third-party partnerships affecting Coinbase’s revenue without prior approval. It also grants Coinbase partial control over Circle’s intellectual property in the event of insolvency—factors that make a full acquisition seem like a natural progression to many industry observers.
“I feel like they’re one company,” said one source familiar with the dynamics between the two firms.
Ripple’s Aggressive Expansion Strategy
While Coinbase appears to be the most logical buyer due to existing ties, Ripple has emerged as a serious contender. The firm previously submitted a bid valued between $4 billion and $5 billion for Circle, which was rejected as too low, according to Bloomberg and independently confirmed by Fortune.
What sets Ripple apart is its massive liquidity in XRP, the native cryptocurrency it developed. As of March 31, 2025, Ripple reported holding approximately 4.56 billion XRP (valued at $11.77 billion), with an additional 37.13 billion XRP—worth around $95.7 billion—held in escrow and released monthly.
Any potential acquisition offer from Ripple would likely combine cash and XRP tokens. This hybrid payment model could appeal to Circle’s shareholders looking for exposure to long-term crypto appreciation while securing immediate capital.
Despite its strong balance sheet, Ripple faces challenges compared to a public acquirer like Coinbase. Regulatory scrutiny around XRP’s classification as a security continues to cast uncertainty, potentially complicating large-scale transactions.
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Acquisition vs. IPO: Weighing the Options
For Circle, choosing between an IPO and a sale involves strategic trade-offs.
Going public offers independence, access to public capital markets, and enhanced brand visibility. The recent successful IPO of eToro—which surged nearly 29% on its first trading day after raising $620 million—has reinvigorated confidence in crypto-related listings. After years of market stagnation post-2021, this momentum could benefit Circle’s timing.
On the other hand, a sale provides certainty. In volatile markets, a guaranteed exit at a premium valuation eliminates execution risk tied to investor sentiment or macroeconomic conditions.
Coinbase CEO Brian Armstrong acknowledged ongoing interest in strategic opportunities during a May 14 interview with Bloomberg: “They’re going public doesn’t change anything about our commercial relationship… but in terms of other deals we might consider in the future, that would be up to them and us—but nothing to announce today.”
Armstrong emphasized that while Coinbase actively evaluates M&A opportunities—bolstered by its $8 billion cash reserve and status as a public company—it remains disciplined: “We don’t swing at every pitch.” Integration complexity, he noted, is often more challenging than the acquisition itself.
Coinbase has already made bold moves in 2025, including a $2.9 billion acquisition of Deribit, a leading crypto derivatives platform, and smaller but strategic purchases like Iron Fish’s privacy-focused team and Spindle, an onchain advertising platform.
Ripple too has been active, acquiring prime brokerage Hidden Road for $1.25 billion in April—showcasing its intent to expand beyond payments into institutional crypto services.
Market Conditions Favor Strategic Moves
Coinbase’s upcoming inclusion in the S&P 500 on May 19 served as a major catalyst, sending its stock up over 25% last week. Though still below its 52-week high of $349.75, shares traded around $265 in mid-May, giving the company a market cap of approximately $56 billion.
This recognition underscores growing institutional acceptance of cryptocurrency businesses and strengthens Coinbase’s position as both an acquisition target and potential acquirer.
Frequently Asked Questions (FAQ)
Q: Is Circle definitely being sold?
A: No. Circle has publicly stated it is not for sale and remains committed to its IPO process. Talks with Coinbase and Ripple are informal and non-binding.
Q: Why would Coinbase want to buy Circle?
A: Acquiring Circle would consolidate control over USDC—the second-largest stablecoin—and eliminate revenue-sharing obligations. It would also strengthen Coinbase’s dominance in crypto infrastructure.
Q: Could regulatory issues block a deal?
A: Yes. Any acquisition involving major crypto firms would face scrutiny from U.S. regulators, especially given past concerns about market concentration and stablecoin oversight.
Q: How does Ripple plan to finance a bid?
A: Ripple could use a combination of cash reserves and XRP tokens. Its large holdings provide flexibility, though reliance on XRP may raise valuation concerns for sellers.
Q: What happens to USDC if Circle is acquired?
A: USDC is designed to be resilient to corporate changes. Its reserves are audited monthly, and governance mechanisms exist to ensure continuity regardless of ownership structure.
Q: When will Circle’s IPO happen?
A: No official date has been set. The company has filed preliminary paperwork but has not begun marketing the offering or set pricing terms.
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Conclusion
Circle stands at a pivotal crossroads: proceed with an IPO amid improving market conditions or accept a strategic buyout from one of two powerful suitors—Coinbase or Ripple.
While the company insists it is not for sale, the depth of existing ties with Coinbase and Ripple’s aggressive expansion suggest that consolidation in the stablecoin sector may be inevitable.
As regulatory clarity improves and institutional adoption accelerates, deals like these could redefine the landscape of digital finance in 2025 and beyond.
Core Keywords: Circle IPO, USDC stablecoin, Coinbase acquisition, Ripple buyout, crypto M&A, stablecoin market, S-1 filing, digital currency