Key takeaways:
- Circle, the crypto payments company behind USD Coin, has announced a $400 funding round
- BlackRock, Fidelity, and other prominent financial institutions will be investing in the stablecoin company
- In addition to financial backing, BlackRock has formed a strategic partnership with Circle and will explore “capital market applications for USDC”
Circle to raise $400M from BlackRock, Fidelity, and other investors
Circle, a global payments technology company and the issuer of USD Coin (USDC), has announced it is raising $400 million in new capital in a funding round that is slated to conclude sometime in the second quarter of this year.
Circle, a founding member of The Centre Consortium along with Coinbase, has penned a deal for the new funding round with some of the biggest financial companies in the world, including BlackRock, Fidelity, Marshall Wace, and Fin Capital.
Beyond backing Circle with a considerable capital injection, BlackRock will become a primary asset manager of USDC cash reserves and Circle’s strategic partner, “exploring capital market applications for USDC,” according to the company’s statement.
Circle co-founder and CEO Jeremy Allaire said the new funding round will fuel the next stage of the company’s expansion. “It’s particularly gratifying to add BlackRock as a strategic investor in the company. We look forward to developing our partnership.”
With 16,500 employees across offices in 30 countries, BlackRock is the world’s largest asset manager, with a staggering $10 trillion in assets under management as of January 2022.
The cooperation between Circle and the financial services behemoth comes just two weeks after the stablecoin company announced BNY Mellon, one of the oldest financial institutions and the largest custodian bank ($46.7 trillion in assets under custody), has been selected as the primary custodian for USDC reserves.
The stablecoin sector has exploded in the last two years. Source: The Block
USDC has been one of the fastest-growing stablecoins in recent months. In mid-January, it overtook Tether (USDT) as the largest stable digital currency on Ethereum. Less than a month later, USDC surpassed $50 billion in circulating supply for the first time ever. At the time, Circle announced that USDC’s supply had increased by a whopping 10,000% since the start of 2020.
As a whole, the stablecoin sector has seen tremendous growth in the last two years. According to data from The Block, the total stablecoin supply has increased from $5.9B in January 2020, to over $180 billion in April 2022.
