USDC stablecoin publisher Circle Internet Financial Ltd. decided to move its legal base from the Republic of Ireland to the United States. The decision, which comes ahead of the company's IPO, raises important questions about the impact of Circle's move to the global financial market and investors involved.
The Reason Circle Moved To The US
On May 15, Bloomberg reported that Circle had submitted court documents to amend its legal domicile from Ireland to the US. Although the company's spokesperson confirmed this move, the reasons behind it were not yet entirely clear. However, this relocation is seen as a step to strengthen Circle's presence and credibility in the US financial market, similar to Coinbase.
USD Coin (USDC), a stablecoin published by Circle, is the second largest stablecoin in the world after Tether (USDT). With a market capitalization of around US$32.9 billion (around Rp488 trillion), USDC is the sixth largest crypto player by market cap. Meanwhile, Tether still leads with a market capitalization of Rp1,642 trillion.
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Meanwhile, in January, Circle was reportedly secretly submitting a draft S-1 registration statement to the US Securities and Exchange Commission (SEC). With this effort, Circle intends to go public, aka to the stock exchange. This is also touted as the main reason behind the relocation.
The SEC review process is a crucial step in which the SEC will assess the registration statement to ensure adequate information disclosure and compliance with regulatory requirements. The SEC usually issues a comment letter within 30 days, which lists deficiencies and requests additional information.
According to PwC, quoted from CCN, non-US companies can raise capital in the US without registering with the SEC through an exemption called Rule 144A. This rule allows companies to offer securities to be sold or resold to institutional investors without the need for SEC registration. However, Circle's decision to pursue an IPO and become a public company shows that they value the benefits of public exposure and a wider trade market in the US.
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