Circle shares close 16% higher after $222M token sale, mixed earnings 

Shares of Circle Internet Group Inc. closed 15.9% higher today after it reported earnings, announced a token sale and debuted a new set of developer tools.

NYSE-listed Circle issues the popular USDC stablecoin. Users can purchase the US dollar-denominated token by depositing fiat currency in accounts operated by the company. The interest that those deposits collect accounts for the bulk of Circle’s revenue, while the rest comes from a lineup of developer tools.

The company ended the first quarter with sales of $694 million, 20% more than a year earlier. The interest income that the company earns from users’ fiat deposits accounted for $653 million of that sum, which represents a 17% year-over-year increase. The total value of USDC in circulation reached $77 billion at the end of the quarter. 

Circle’s revenue missed the consensus estimate by $28 million. The fact that the company’s stock nevertheless closed higher may partly be the result of its earnings numbers, which topped expectations. 

Circle ended the third quarter with adjusted EBITDA, or earnings before interest, taxes, depreciation, and amortization, of $151 million. That amounts to adjusted earnings of $0.21 per share, or $0.03 more than what the market expected. It’s also 24% higher than the profit Circle delivered a year earlier.

The token sale that the company announced in conjunction with its earnings report may have also factored into its share price gain. Circle disclosed that it has raised $222 million in a presale of its Arc token. According to CNBC, the cryptocurrency now has a market capitalization of $3 billion.

Arc is powered by a Circle-developed blockchain of the same name that is currently undergoing testing. It’s optimized for enterprise use cases such as lending. One Arc’s main selling point is its predictable transaction fee structure, which avoids the price fluctuations that affect some competing blockchains.

Circle’s token sale was led by Andreessen Horowitz. It was joined by York Stock Exchange operator Intercontinental Exchange Inc,. BlackRock, Apollo Funds and other Wall Street heavyweights. Circle says that several major financial institutions are piloting Arc as part of their cryptocurrency adoption programs.

The third major update the company announced today relates to its lineup of developer tools. One of the services in the suite, Wallets, enables consumer finance companies to embed crypto wallets into their apps. The other tools ease adjacent use cases such as moving funds across blockchains.

Circle today debuted a new collection of developer tools called the Circle Agent Stack that enables artificial intelligence agents to make payments. The suite is underpinned by Agent Wallets, a service that gives AI agents access to digital wallets. Developers can set spending rules to limit how agents use the funds at their disposal. 

Another new service, Nanopayments powered by Circle Gateway, enables agents to make purchases valued at as little as $0.000001. Circle envisions AI applications using the feature to purchase small items such as one-time access to a piece of data. Agents can also buy access to other agents. 

Developers can create wallets and launch transactions through a new command line interface called Circle CLI. It’s joined by the Agent Marketplace, a portal for finding services to which agents can purchase access. 

“Financial infrastructure has historically been built for people, with manual onboarding, approvals, and payment flows that were never designed for software acting on its own,” said Circle co-founder and Chief Executive Jeremy Allaire. “We believe the next phase of the global economy will be increasingly AI and agent-driven”

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