Circle revenue boosted as stablecoin demand rises amid volatility; shares up (May 11)

The firm went public in a stellar debut on the New York Stock Exchange last year, paving the way for similar companies to test their luck in the public markets.

Circle's shares closed at $113.67 on Friday, up about 43% year to date and more than three times their IPO price of $31.

"From a long-term perspective, it's tough to be bearish on Circle Group," said Andrew Rocco, stock strategist at Zacks Investment Research.

Wall Street expects stablecoins to become one of the biggest themes within finance in the coming years and the next multi-trillion-dollar market opportunity.

Interest-rate cuts late in 2025 also benefited the company, as Circle invests the cash backing its tokens in bank deposits and short-dated U.S. Treasuries, earning interest on those holdings. As a result, its income is highly sensitive to policy changes by the U.S. Federal Reserve.

"Rates have cycles, and we are building a company that's going to be living through many rate cycles," CFO Jeremy Fox-Geen said in an interview with Reuters, when asked about the potential future impact of monetary policy easing.

May 11 (Reuters) - Circle reported higher quarterly revenue and reserve income on Monday, driven by increased adoption and circulation of its stablecoin, pushing its shares 2% higher in early trading.

Market volatility and the Middle East conflict pushed investors to rotate out of risky cryptocurrencies and into stablecoins to park capital earlier this year.

This was underscored by cryptocurrency exchange Coinbase's results last week, which reported dropping trading volumes. Coinbase has a strategic partnership with Circle.