Key Takeaways:
- Circle (CRCL) stock has skyrocketed 700% since its IPO, but billionaire Chamath Palihapitiya revealed employees lost nearly $3 billion in the process due to the traditional IPO structure.
- Justin Sun’s Tron is opting for a SPAC merger to go public, highlighting a growing preference for alternatives to traditional IPOs in the crypto sector.
Circle (NASDAQ: CRCL) stock surged another 20% on Friday, adding to a staggering 700% rally since the company’s IPO earlier this month. The USDC stablecoin issuer now boasts a market cap nearing $50 billion — an extraordinary ascent given its initial public valuation of under $8 billion just 15 days ago.
Yet amid this meteoric rise, billionaire investor Chamath Palihapitiya has pointed to a less rosy side of the IPO success story: Circle’s employees have collectively forfeited nearly $3 billion due to the traditional public listing route.
According to Palihapitiya, the necessity to sell 14.4 million shares at $31 each — totaling $450 million — to facilitate the IPO process ended up being a major loss for employees. With CRCL stock now trading at a much higher valuation, the opportunity cost translates to an estimated $3 billion “gift” to external parties, he argued in a recent post on X (formerly Twitter).
This was what I was hoping to fix with SPACs. You may not like SPAC founder promotes or other forms of value transfer to intermediaries but you can never claim it wasn't disclosed.
— Chamath Palihapitiya (@chamath) June 20, 2025
The Circle IPO, and ALL traditional IPOS, are the opposite. Value is transferred to randoms and it… https://t.co/3QGTCLxeIL
“This is why I prefer SPACs over traditional IPOs,” wrote Palihapitiya. “Value in SPACs and direct listings is transferred to intermediaries, but at least it’s disclosed upfront and negotiable. In traditional IPOs, banks use opacity to reward their best customers with free stock. In this case, it was a $3B gift from the employees and investors of Circle to people they don’t know, will never know and have nothing to do with their journey.”
The rally in Circle’s stock comes as U.S. lawmakers advance the GENIUS Stablecoin Act — legislation seen as favorable to stablecoin issuers like Circle. The bill is now headed to the House for final approval, further fueling market optimism around the sector.
Justin Sun’s Tron Eyes SPAC Route
Meanwhile, Tron founder Justin Sun appears to be taking lessons from this saga. Earlier this week, Sun announced plans to go public via a SPAC merger with Nasdaq-listed SRM Entertainment — effectively bypassing the traditional IPO route.
Also Read: Circle Stock Gains Momentum with ProShares, Bitwise ETF Filings Following IPO
The reverse merger will lead to SRM’s rebranding as “Tron Inc.” Sources indicate that Dominari Securities, a boutique investment bank linked to former U.S. President Donald Trump, will oversee the deal. Once public, Tron plans to launch a new Tron Reserve aimed at bolstering its ecosystem.
As the debate around SPACs versus IPOs continues, Circle’s stock surge and employee losses may become a case study for crypto firms weighing their own path to public markets.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
