As of this week, there have been 174 IPOs on the US stock market this year, 82.5% less than the same time in 2021, which had 997 IPOs by this date.
An indicator that the economic downturn is affecting every sector, especially web3 companies who have had to battle with the bear market complicated by all the negative sentiments from cases of fraud and hacks.
Which company is the spotlight on today?
Circle, the company behind stablecoin USDC which has terminated its agreement with special-purpose acquisition (SPAC) company Concord Acquisition Corp., thereby stepping back from its plan to go public. Stablecoins are cryptocurrencies that are pegged to fiat currencies (stable assets), aka the money you spend, to maintain a stable price.
The issuer of the world's second largest crypto stablecoin, had announced its plans to go public in July 2021, with a valuation of $4.5 billion. The valuation was later doubled when the firms amended their terms in February. In the third quarter of this year, Circle said that it turned profitable with a net income of $43 million and ending the quarter with almost $400 million in unrestricted cash.
That’s a rare one.
Yeah, profitability is that once forgotten term that wasn’t necessary in the venture capital backed startup space until recently.
Zoom out: Circle’s termination comes after similar high-profile crypto firms, such as trading platform eToro in July and bitcoin miner PrimeBlock in August, have cancelled plans to go public via a SPAC.
Guess the time isn’t just right.