By the close of Circle Internet Group’s first trading day on Thursday, June 5, its stock had rocketed to $88, a 180% jump from the price institutional investors paid for their shares in the underwriting led by JPMorgan, Goldman Sachs, and Citigroup . The upshot: The company and insiders combined left a gigantic amount of money on the table by agreeing to a price far below what investors were willing to pay. As Fortunepreviously noted , that “left on the table” figure was the seventh largest in the history of all IPOs since 1980, exceeded only by the debuts of Visa , Airbnb , Snowflake, Rivian, DoorDash , and Coupang , the latter nicknamed “the Amazon of South Korea.”
Circle was just revving up. On Friday, June 6, its stock jumped another nearly 30% to $107.5. That additional leap hurtled the issuer for the USDC stablecoin to a historic record. Jay Ritter—a professor at the University of Florida and the world’s leading expert on IPOs—confirmed that for all go-public events since 1980 that raised $500 million or more, Circle’s two-day moonshot of nearly 250% ranks as by far the highest. The crypto favorite’s showing easily eclipsed the second place “pop” sounded by software provider C3.ai of 209% at its 2020 entry on the Nasdaq .
All told, Circle sold 39 million shares, raising $1.145 billion after underwriting fees of $67 million. Had the shares fetched the $107.5 close on June 6 instead of the $31 (excluding fees) paid in the presale by the likes of mutual and hedge funds, the company and insiders combined would have collected $4.144 billion. Hence, as of the second day of trading, the IPO had left a staggering $3 billion on the table. Put simply, for every $1 going to the sellers, $3 in two-day gains flowed to the underwriters’ Wall Street clients as a windfall.
At a market cap of $22 billion, Circle is selling at 140 times earnings. Given that treacherous valuation and the onslaught of stablecoin rivals invading its space, Circle is the epitome of an ultrahigh-risk stock. Money that might have been sitting in its treasury as a buffer against tough times vanished in this mind-bending spectacle that only the confluence of crypto craziness and Wall Street’s genius for underpricing IPOs could have staged.