Coinbase and Ripple Are Now Competing to Buy Circle, the Company Behind USDC

Big news is coming out of the crypto world — Coinbase and Ripple are now competing to buy Circle

Big news is brewing in the crypto world as Coinbase and Ripple are reportedly vying to acquire Circle, the company behind the renowned stablecoin USDC.

Circle had been planning to go public via an IPO (Initial Public Offering), but it seems they might be selling the company instead. According to a Fortune report, unnamed sources confirmed that both firms are in talks with Circle, although nothing has been finalized yet.

Earlier this year, Ripple reportedly tabled an offer of $4 to $5 billion to acquire Circle, which was rejected. However, with competition heating up, experts believe the price tag could now be closer to $6 to $6.5 billion. This is a typical scenario in bidding wars, where companies pay a slight premium to secure a deal.

As the Paul Barron Network highlights, this sale is about more than just company ownership. Whoever takes control of USDC would inherit a massive position in the rapidly expanding stablecoin market. Stablecoins are emerging as formidable competitors to traditional payment systems like Visa and Mastercard, and both Ripple and Coinbase recognize the immense value of USDC in the years to come.

Can Coinbase Afford the Deal?

Looking at the figures, Coinbase appears to be in a decent financial standing to pursue this deal. According to recent financial data, Coinbase currently holds about $8.5 billion in cash and $2.8 billion in crypto investments. Together, this totals around $11.3 billion in liquid assets. While they could undoubtedly afford the purchase, it would require them to adjust their balance sheet and possibly take loans or make financial maneuvers.

What About Ripple?

On the other hand, Ripple doesn'{~}t necessarily need Circle to survive. The company has been making significant moves lately, including launching regulated XRP futures on the CME Group. This action clearly indicates that Ripple is far from slowing down despite encountering legal and market challenges in the past.

Moreover, Ripple once handled up to 20% of USDC traffic at one point, primarily when converting funds from Tether (USDT). This experience shows that Ripple already understands how to manage stablecoins on a large scale, making them a formidable force in this bidding war.

Why Didn’t Coinbase Buy Circle Earlier?

One question everyone is asking is why Coinbase didn’t buy Circle earlier when they had the chance and the prices might have been lower. Did they miss an opportunity, make a strategic decision, or is there something else happening behind the scenes?

At this stage, it seems like anyone’s game. If Circle decided to accept an offer today, who would have the upper hand? The current predictions put the chances at around 45% for Coinbase, 45% for Ripple, and 10% for a surprise third-party bidder—a “dark horse”—who might suddenly join the race now that news of the sale is out there.

Ultimately, whoever wins this battle could secure a powerful position in the US crypto market, especially as stablecoins become increasingly popular for everyday transactions.