Key Notes
- SBI Group announced its strategic investment of $50 million in CRCL shares.
- The Japanese financial firm allocated its investment evenly across SBI Holdings and its subsidiary, SBI Shinsei Bank.
- The recent development further expands SBI Group’s existing partnership with Circle.
On June 9, Japanese financial giant SBI Group announced its strategic investment of $50 million in Circle Internet Group (NYSE: CRCL) in its initial public offering (IPO).
The Tokyo-based firm allocated its investment evenly across SBI Holdings and its subsidiary SBI Shinsei Bank.
SBI Group Expands a Two-Year-Old Partnership With Circle
According to a Nikkei report , SBI Group , a major partner of Ripple Labs XRp $2.33 24h volatility: 2.3% Market cap: $137.04 B Vol. 24h: $2.75 B , acquired 5% of the 34 million shares that Circle offered during its IPO.
This accounts for up to 170,000 CRCL shares. The latest development reflects the growing alliance between SBI Group and the stablecoin issuer, following a business agreement signed in November 2023.
Back then, Circle inked a partnership deal with SBI Holdings to expand its presence in Japan. By signing a memorandum of understanding (MoU) with a Tokyo-based financial services conglomerate, the firm sought to broaden the adoption of its USDC stablecoin and the Web3 ecosystem outside the United States, where Circle is headquartered.
It is worth noting that the Japanese government had just introduced its revised Payment Services Act around that time. It aimed to establish a clear regulatory framework for issuing and using stablecoins in the country.
Since then, their business relationship has blossomed, moving into collaborative efforts across various sectors of digital finance.
SBI VC Trade Offers USDC Publicly
Earlier this year, SBI VC Trade, the crypto unit of SBI Group, commenced a USDC stablecoin service .
This made it the first platform in Japan to offer USDC publicly earlier this year. It began with officially registering as an “electronic payment instrument business operator” with the Kanto Regional Financial Bureau.
The rollout was initially conducted in beta, providing limited distribution within the SBI Group. SBI VC Trade was more concerned with examining the business flow before making it available to the public.
This was a strategy to help them understand what is working and where to improve before the launch.
Circle Goes Public With an IPO Listing on NYSE
Meanwhile, this SBI Group investment follows Circle’s successful IPO listing on the New York Stock Exchange (NYSE). After several failed attempts, the stablecoin issuer has filed to go public in the United States.
Based on the announcement from May 27, it offered 24 million shares of its Class A common stock.
From this volume, 9.6 million shares were directly from the company, and the other 14.4 million were from selling stockholders.
At first, the IPO price was capped at $24.00 and $26.00 per share, but was later upscaled to about $28.00 per share based on increased demand. It turned out that the IPO was 25 times oversubscribed.
When the offering was eventually made public, it went for as high as $31 each.
On trading Day 1, shares opened at $69 and closed at $83.23, pushing the company’s market cap to around $16.7 billion. Circle’s IPO, which raised between $1.05 billion and $1.1 billion, became one of the most successful fintech public offerings since Coinbase’s debut in 2021.
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