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Crypto giant Circle just filed for an IPO: Here are 5 key takeaways

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Circle Internet Financial, a leading U.S. crypto firm that issues the stablecoin USD Coin, filed long-anticipated paperwork for an initial public offering on Tuesday. The 225-page financial disclosure includes previously unreported insights into one of the world’s largest crypto firms, illustrating Circle’s outsized presence in the booming stablecoin space, as well as the risk factors that might give investors pause ahead of an IPO. 

Founded in 2013, Circle has attempted to go public before, resulting in a failed SPAC agreement in 2022 that cost the company over $44 million in costs, according to the S-1 filing.  But with the crypto industry ascendant in the U.S. thanks to the support of President Donald Trump, Circle is hoping that the second time is the charm—and boasts over $1.6 billion in revenue in 2024 to attract would-be investors. 

Although the document does not lay out a timeline for Circle’s public offering plans, companies’ shares typically begin trading within weeks of filing their S-1. Fortune previously reported that the fintech—which plans to trade under the ticker CRCL—is working with investment banks JP Morgan Chase and Citi on the IPO. Here are some key takeaways from the S-1 filing: 

Circle is growing—but its income depends entirely on stablecoin reserves

When Jeremy Allaire and Sean Neville cofounded Circle during the early days of the blockchain industry, they intended the company to disrupt the payments space, launching different products, including a crypto exchange and Venmo-type service. Around 2018, the firm began to focus entirely on stablecoins, a type of cryptocurrency that is pegged to an underlying asset, such as the U.S. dollar or a commodity like gold or oil. 

Circle’s stablecoin USDC exploded in popularity during the last crypto bull market, rising from a market capitalization of under $1 billion in 2020 to over $50 billion in 2022. Because USDC is backed by dollar-like assets such as U.S. treasuries, Circle earns a hefty return on the interest generated by its reserves, keeping the revenue rather than passing it on to USDC holders. Those returns still represent the vast majority of Circle’s revenue. According to the S-1, over 99% of Circle’s $1.68 billion in revenue from 2024 came from reserve income, with just $15 million coming from other sources. 

That means that Circle is highly dependent on a single source of revenue—and one that is dependent on government-set interest rates. In the S-1, Circle estimated that just a 1% decrease in interest rates could result in a $441 million decrease in its stablecoin reserve income. However, Circle argued that a decrease in interest rates could result in a rise in USDC in circulation as investors turn to different financial strategies. “Any relationship between interest rates and USDC in circulation is complex, highly uncertain, and unproven,” reads the filing. 

Circle is paying Coinbase and Binance to boost USDC adoption

Circle originally envisioned USDC as a partnership between different crypto firms and traditional financial institutions, creating a consortium called Centre that would help govern and issue the stablecoin. But Centre only have had one other participant—the leading crypto exchange Coinbase. Circle and Coinbase shuttered Centre in 2023, though they remain partners on USDC. 

New disclosures from the S-1 reveal how the partnership shifted in 2023, with Coinbase taking a minority equity stake in Circle. Before the new agreement, Circle and Coinbase shared revenue generated from USDC reserves based on the amount distributed and held by each company. But under the new terms, the payments are more evenly split based on the total reserve income, though it is still divided by how much is held by each company’s wallets and custodial products.

Last December, Circle also announced a partnership with the top crypto exchange Binance to promote the adoption of USDC and hold the stablecoin as part the company’s treasury. According to the S-1, Circle paid Binance a one-time fee of $60.25 million for the partnership, as well as agreeing to pay a monthly fee representing a percentage of USDC held on Binance and its treasury.  

Circle is feeling the heat from competition

While USDC’s market cap has exploded over the past year, doubling from around $30 billion to $60 billion, it is facing a crowded marketplace. Along with its main rival—the offshore Tether, which boasts a market cap of over $140 billion—Circle lists a number of other competitors in its S-1. That includes PayPal, which launched its own stablecoin in 2023, and banking giants like J.P. Morgan that are exploring the blockchain space. 

Still, Circle sees bullish conditions ahead, including the passage of stablecoin legislation in the U.S. After the Senate Banking Committee advanced a bill in March, the House is expected to vote on its version this week, with Circle ready to benefit from more regulatory certainty. That could only invite more players into the space, however.

Circle’s venture capitalists are poised to cash in

Allaire, CFO Jeremy Fox-Geen, and more than ten other executives stand to reap millions from Circle’s forthcoming IPO. But the real winners are the investors in Circle who hold 5% or more in the company’s stock. Those include the venture capital firm General Catalyst, which owns the most shares among the biggest corporate holders. IDG Capital, a Beijing-based venture firm, is not far behind. Other big VCs set to cash in on the Circle IPO are Breyer Capital, Accel, and Oak Investment Partners. Fidelity, the investment bank that has dipped its toes more and more into crypto, is also a big owner.

Collectively, Circle’s biggest investors hold more than 130 million shares in the stablecoin giant. The initial filing did not include details about how much money Circle is targeting to raise through its IPO, though sources say the IPO aims for a valuation of $4 to $5 billion.

It pays to work at Circle

Circle’s executives make a pretty penny. Allaire, unsurprisingly, is the most well-compensated and has a total compensation package of more than $12 million. That’s $900,000 in base salary, $9 million in stock awards, plus another $2 million in other benefits.

Jeremy Fox-Geen, the CFO, is the second-most compensated exec and has a take-home pay of $5.2 million. That’s $500,000 in base pay, $4 million in stock awards, and another $700,000 in other benefits. Rounding out the top executives are Chief Strategic Engagement Officer Elisabeth Carpenter, President and Chief Legal Officer Heath Tarbert, and Chief Product and Technology Officer Nikhil Chandhok. All of them make in the range of $4 to $5 million, according to the SEC filing.

This story was originally featured on Fortune.com



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Crypto prices make a comeback after Trump announces a pause on most tariffs

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Cryptocurrencies and related stocks soared on Wednesday after President Donald Trump announced a 90-day pause for most countries caught up in his sweeping tariff policy. 

The upswing is an abrupt change for the crypto space as a whole, which has suffered major declines over the last few weeks amid tariff turmoil. Coinbase shares tumbled 15% in the days following Trump’s “Liberation Day” announcement of levies on nearly all U.S. trading partners. Bitcoin, Ethereum and XRP were all down 10%, 20% and 22% respectively. 

But hours after Trump’s tariffs took effect on Wednesday, the president posted on his social media platform Truth Social that he had authorized a 90-day pause on some tariffs and “a  substantially lowered reciprocal tariff during this period of 10%.” China, however, is the exception, and Trump announced new tariffs on the country that increased overall levies on products from that country to 125%.

That single post sent stocks in the traditional markets soaring. Galaxy Digital is up 18% in the hours since Trump’s reversal, as investors breathe a sigh of relief. Bitcoin mining companies Riot Platforms and Mara Holdings are also up since the reversal. And cryptocurrencies Bitcoin, Ethereum and XRP all increased by 5%, 9% and 9%, respectively. 

Tariffs have had no direct impact on cryptocurrencies and crypto companies, but these assets were dragged down by a general risk-off sentiment from investors who see them as highly volatile. The economic uncertainty caused investors to flee risky assets in an attempt to brace themselves for the impacts of a brewing trade war. 

“This environment is very much a macro-driven environment,” John Tadaro, an analyst at investment bank Needham & Company, told Fortune. “In the last two weeks, Coinbase and other companies I cover are trading mostly based on tariffs, expectations for fiscal policy, and a general either risk off or risk on sentiment.”

While crypto had been particularly hit hard by tariff fears, the uncertainty around high levies imposed by the U.S. on other countries has reverberated throughout the entire financial system. 

The high tariffs are expected to drive up the price of goods by disrupting global supply chains, and increasing inflation. On Wednesday, fears of “serious liquidity issues” added to the strain on financial markets, pushing investors and economists to raise the alarm about possible disastrous consequences for the U.S. economy. 

This story was originally featured on Fortune.com



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Surrogacy just brought YouTube and Netflix star Ms. Rachel a new baby—and she’s not alone. Here’s why the business is booming

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Baby whisperer Ms. Rachel—the YouTuber-turned-Netflix-star who built a multi-million dollar empire entertaining the youngest of viewers—now has an infant of her own. The new mom, who also shares a 7-year-old son with her husband Aron, took to Instagram on Tuesday to make the announcement—and to thank her surrogate.

“I was unable to carry this pregnancy for medical reasons and we were blessed to have a surrogate who gave us the most precious gift possible,” wrote Rachel Griffin Accurso, aka Ms. Rachel. “We are now all family forever. We have immense gratitude and a deep bond. It’s been a truly beautiful experience. I’m in awe of her.”

Many other high-profile parents have also had babies via surrogate—Sarah Jessica Parker, Elton John, Nicole Kidman, Kim Kardashian, Khloe Kardashian, Gabrielle Union, Tyra Banks, and Andy Cohen, just for starters. 

And plenty of regular folks have, too. The number of embryo transfer procedures using a gestational surrogate more than tripled to 9,195 between 2010 and 2019, according to a Fortune story that used Centers for Disease Control and Prevention fertility clinic data (no longer available on the CDC site). 

While the exact current numbers are difficult to pinpoint, it’s safe to say the business is booming: The global surrogacy market was valued at $175.79 million in 2022 and is projected to reach $303.35 million by 2031, growing at a compound annual growth rate of 6.25% during that time. North America is the highest contributor to the market, expected to grow during the same period by 6.3%.

Still, many people don’t know much about the process. Below, experts walk readers through the surrogacy basics. 

What is surrogacy?

In the simplest terms, surrogacy is when another person carries and delivers a child for another couple or person, known as the intended parents or parent. 

In the past, this was done via traditional surrogacy—essentially doing an artificial insemination in the surrogate mother who then gave birth to, and relinquished (or not, in the infamous Baby M custody case), a baby of her genetic makeup, created from her own egg. 

And while a mistaken belief persists that all surrogacies are still traditional surrogacies, with folks thinking it’s “just a mom giving up her baby,” explains Rachael Jones, a nurse practitioner and VP of Clinical Client Strategy at the family-building company WIN, “it’s more complicated than that, and more nuanced.” 

It’s also a completely different process, called gestational surrogacy, meaning that the surrogate is in no way directly related to the offspring. “So essentially, the egg and the sperm are fertilized via IVF outside of the body in the lab, and then an embryo is placed, through an embryo transfer, into the uterus of the gestational carrier,” Jones says. “And so when she gives birth, it’s not biologically her child,” making the arrangement much clearer from a legal standpoint.

How does commercial surrogacy work?

In the U.S., most surrogacies are arranged through an agency, which matches surrogates with intended parents. Those are commercial surrogate arrangements—meaning the surrogate is financially compensated—although there are sometimes what’s known as altruistic arrangements, whereby a woman carries the baby of a friend or a loved one for other reasons, and is not paid.

Those who are paid typically make about $30,000, says Jones—although the total cost for the intended parent or parents is much greater, usually ranging from $100,000 to $200,000. 

“It’s quite, quite significant, and that’s largely because you’re paying a lot of different people,” explains Jones. “So generally, you’re potentially compensating the surrogate. Then the agency that matches you and does all the work behind the scenes is getting compensated. You have to have an attorney for both parties—the intended parents as well as the surrogate—and then you’re paying for the medical services.” That sometimes includes getting a separate medical policy to cover the surrogate’s labor and delivery costs. 

“And this is a completely cash market,” she adds. “There’s not any coverage. There’s reimbursement often, through companies like ours that work with big employers, but it’s nothing compared to what the cost is.”

In fact, it’s what drives some intended parents to find surrogates in other countries, where the process is much cheaper. But that comes with risks, warns Jones, as it’s hard to know if the process is exploitative, particularly in countries like India and Turkey, “basically taking advantage of somebody who is destitute and has no options.” Tricky situations can also arise, such as war in the surrogacy hub of Ukraine.

Is surrogacy legal?

Commercial surrogacy is not federally regulated but left to the states, creating a patchwork of laws by which it’s allowed without restriction in 15 states, with various conditions or legal hurdles in 32, while three states (Arizona, Indiana, Nebraska) prohibit surrogacy contracts and Louisiana prohibits surrogacy altogether.

“More and more people do actually travel for surrogacy within the U.S., because there are just a lot of states with gray areas,” Jones says.

Globally, at least 10 countries ban commercial surrogacy, including Cambodia, Italy, Germany, and Spain.

Reasons behind illegality, believes surrogacy attorney Judith Hoechst—board member of Resolve: The National Infertility Association, past chair of the American Society of Reproductive Medicines, and mother to a 21-year-old son had through surrogacy—range from extreme judgment of parents who use surrogates to a “paternalistic” attitude. 

“I think there’s a judgment that people just want to pay somebody to carry their baby because they don’t feel like being pregnant,” she says. “I’m going into my 15th year practicing reproductive law, I have never had one single case where somebody doesn’t want to carry their pregnancy.” 

Her clients, she says, have often gone through dangerous pregnancies and are told not to try it again, or they’ve had hysterectomies—or breast cancer that makes it too risky to be exposed to the estrogen needed for IVF procedures. And about 15% of her clients are same-sex dads.

“I just came back from the third International Surrogacy Forum in Cape Town, Africa, and so much of the world is against surrogacy because they think it’s the commodification of women,” she tells Fortune. “So I think there is paternalism involved, where men think they know what’s best for women, instead of women saying, ‘I know what’s best for me.’”

Still, there is a feminist angle opposing surrogacy, including through the International Coalition for the Abolition of Surrogate Motherhood, and, in the U.S., the Coalition Against Trafficking in Women, which pushed back against New York when the state moved to legalize the practice in 2020 with executive director Taina Bien-Aimé warning, “As with all organized exploitation of women for profit, this is also a follow-the-money game.”

Some research, meanwhile, points to surrogate pregnancies being higher risk than others—something some surrogates may not always understand going in.

Why more and more people are using surrogates

“I think the only reason, honestly, is because one in six people struggle with infertility, and they are at the end of the road to try to have a child,” says Hoechst. And unlike adoption, she says, it’s a way to have genetic offspring. But also, “adoption isn’t so easy, and international adoptions have pretty much shut down.” 

Jones concurs, noting, ”There certainly are less countries, from an international perspective, that are open to adoption from the U.S. And nationally, there’s also really long wait times for domestic infant adoption. And if you want to have a baby of your own, genetically speaking, then this is sometimes the way to do it.” Especially, she says, since so many women are deciding to try pregnancy later in life, when it can be more difficult. 

But Jones also sees the rise being a result of a shift in belief systems. “I think in general, we’re becoming more open and liberal to fertility in general,” Jones says. “Everybody’s in for family building. It doesn’t matter which side of the aisle that you’re on… And so I think that we’ve all become a little bit more open to knowing that there are different paths to parenthood.”

For Hoechst, that path altered her life’s trajectory—giving her renewed purpose in her career as an attorney and, of course, her son. To this day, she maintains a relationship with the surrogate, just as Ms. Rachel appears to plan on when she says they are now “all family forever.”

“I still keep in touch with her,” Hoechst shares. “I text her on his birthday, on Mother’s Day, over the holidays, to say, ‘thank you for our son’s life. Here are pictures.’ He wouldn’t exist on this earth but for her.”

This story was originally featured on Fortune.com



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Trump puts some tariffs on ice after days of global mayhem—except for China, ‘based on the lack of respect’

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