⚯ Michel de Cryptadamus ⚯May 29, 2025

#FinancialTimes did a deep dive on the business model of the world's second largest #stablecoin: Circle's #USDC. It's the one that's managed by an American company and is significantly less connected to Chinese organized #crime than the other #stablecoins.

Circle, which has a very deep business relationship with #Coinbase, is trying to go public this year or next. This is their second attempt - they filed to go public ca. 2021 but ended up not doing so because... no one wanted to buy shares in a company like Circle.

I suffered through reading Circle's original SEC filing in 2021 and it made clear that a) Circle wasn't making any money and b) executive compensation was *absurdly* high... but that was in a low interest rate environment. according to #FTAV they can't even make the math work in today's high interest rate world, which surprised me.

* FT: https://www.ft.com/content/269a9260-7445-4b44-9b84-82dcdfc3c92e
* no paywall: https://archive.ph/9gGGm

#crypto #uspol #finance #economics #stockmarket #FT #Circle

Show threadAlien software, human hardware
@cryptadamist how are they still in buisness if they don't make money?
Ok, its the world of crypto currencies, but still usually they at least try to be less obvious.
May 29, 2025 at 4:39pmMegalodon
Show thread⚯ Michel de Cryptadamus ⚯May 29, 2025

@mavu

1. they don't lose money either, so they can keep going

2. their business is laughably simple to run... it's like 1,500 lines of code and then a lot of phone calls with banks. mostly they are just waiting for the US government to send them interest payments every month (billions of dollars worth per year) and then cashing those checks

3. they have to pay coinbase like half of the money they used to make as a vig

4. executive comp is absurdly high for what they are doing... probably because the executives are sucking up all the profits while the getting is good (or at least that was clear in 2021, haven't actually looked at the numbers myself this time but i trust #FTAV's analysis)

Show threadAlien software, human hardwareMay 29, 2025
@cryptadamist this is all completely insane. Smh.
Show thread⚯ Michel de Cryptadamus ⚯May 29, 2025

@mavu tbh stablecoin businesses are the least insane part of crypto... tether is the most profitable company in the history of the world on a per employee / per dollar spent basis and it's not even close.

the mystery to me has always been "wtf are Circle's employees *doing* all day?" there's almost no code to write. the company takes a strict "see no #moneylaundering, hear no money laundering, speak no money laundering" attitude about the billions of dollars USDC is helping get laundered every month. there's close to zero evidence in the market of them succeeding at doing much of anything - all their "use USDC to buy coffee!" efforts have been laughable (at some point last year they had gotten into.. wait for it... 11 small coffee shops in the continental US after like a year of trying)

at least #Tether has the wisdom to just not hire anyone and keep all the money. i've never understood wtf circle is doing.