{"id":3934,"date":"2025-06-24T21:22:07","date_gmt":"2025-06-24T21:22:07","guid":{"rendered":"https:\/\/bitunikey.com\/news\/circle-stock-faces-pressure-as-rate-cuts-lock-up-expiry-loom\/"},"modified":"2025-06-24T21:22:12","modified_gmt":"2025-06-24T21:22:12","slug":"circle-stock-faces-pressure-as-rate-cuts-lock-up-expiry-loom","status":"publish","type":"post","link":"https:\/\/bitunikey.com\/news\/circle-stock-faces-pressure-as-rate-cuts-lock-up-expiry-loom\/","title":{"rendered":"Circle stock faces pressure as rate cuts, lock-up expiry loom"},"content":{"rendered":"

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Circle stock price has gone parabolic after its highly successful initial public offering earlier this month.<\/p>\n

Circle, trading under the ticker symbol CRCL, jumped to a record high of $298, bringing its market capitalization to $58 billion, slightly below the USD Coin (USDC) valuation of $61 billion.\u00a0<\/p>\n

The surge in Circle stock has been driven by ongoing stablecoin hype, with more companies exploring launches of their own. Top U.S. banks are reportedly in talks to develop a stablecoin, while major retailers like Amazon and Walmart are also working on digital dollar products.<\/p>\n

Meanwhile, Fiserv, a $94 billion company, is developing FIUSD, a stablecoin that will leverage infrastructure from Paxos and Circle and run on the Solana (SOL) blockchain.<\/p>\n

Circle stock has also rallied after the U.S. Senate passed the GENIUS Act, which establishes a regulatory framework for the stablecoin market. Circle stands to benefit if Tether (USDT), the current market leader, fails to comply with the new requirements.<\/p>\n

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Circle stock faces risks ahead<\/h2>\n

Despite the rally, Circle stock faces several key risks. For one, the growth of USDC has stalled. Its market capitalization remains around $61.7 billion, roughly unchanged over the past few weeks.<\/p>\n

On the positive side, USDC\u2019s transaction volume and the number of active stablecoin addresses have jumped by 72% and 20%, respectively, in the past 30 days. Adjusted volume rose to $829 billion, while total addresses climbed to 9.7 million.<\/p>\n

The other risk is that Circle has become highly overvalued, which likely explains why Cathie Wood has started to sell. Its market capitalization of $58 billion is slightly lower than its combined assets. It is also much higher than its 2024 revenue<\/a> of $1.67 billion, implying the stock trades at more than 30 times sales which might scare away some invesetors.<\/p>\n

There is also macro risk. The Federal Reserve is expected to start cutting interest rates soon. In recent comments, Fed officials Michele Bowman and Christopher Waller said they would support a rate cut at the July meeting.<\/p>\n

Rate cuts would hurt Circle\u2019s revenue model, as the company earns most of its income from investments in short-term bonds, whose yields will decline in a lower-rate environment. Additionally, CRCL stock may face selling pressure as the IPO lock-up period approaches its expiry in December, which would allow insiders to begin unloading shares.<\/p>\n

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Circle stock price has gone parabolic after its highly successful initial public offering earlier this month. Circle, trading under the ticker symbol CRCL, jumped to a record high of $298,…<\/p>\n","protected":false},"author":1,"featured_media":3334,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-3934","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency"],"_links":{"self":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/3934","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/comments?post=3934"}],"version-history":[{"count":1,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/3934\/revisions"}],"predecessor-version":[{"id":3935,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/3934\/revisions\/3935"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/media\/3334"}],"wp:attachment":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/media?parent=3934"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/categories?post=3934"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/tags?post=3934"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}