The post Circle Stock Plummets By Almost 70% Post-IPO Debut, Analysts Issue Warnings appeared on BitcoinEthereumNews.com. Following a notable debut on the Nasdaq earlier this year, Circle (CRCL), the issuer of the USDC stablecoin, has experienced a significant decline in its stock value. After hitting a peak of $298 on June 23, just 18 days post-launch, shares have now dropped by 68%, trading around $82. Circle Faces Challenges As Lockup Period Approaches Despite benefiting from a softer regulatory stance on digital assets in the US with President Trump’s crypto policies, Circle faces challenges that history does not favor, particularly as it approaches the end of its lockup period.  Analysts, including Dan Dolev from Mizuho, highlighted that this lockup period prevents insiders from selling shares, typically for 180 days after an initial public offering.  Circle’s initial public offering (IPO) filing indicated that this lockup period is set to expire two days after the company unveils its third-quarter earnings, which is this Friday. Mizuho’s analysis of over 750 IPOs with market capitalizations exceeding $1 billion reveals that 58% of companies that outperform the S&P 500 prior to their lockup period tend to underperform the index in the 180 days following it. These companies see an average decline of approximately 2%.  The outlook is even bleaker for firms falling short of revenue expectations in the year after their IPOs, which tend to experience an average negative return of about 10% relative to the S&P 500. Circle may find itself in this latter category according to Mizuho. A significant portion of the company’s revenue comes from the interest on USDC reserves held in short-term US Treasuries, Treasury repurchase agreements, and cash.  Consequently, a decline in interest rates or slower-than-anticipated growth of USDC could adversely impact revenue streams. Dolev noted:  In our view, CRCL is likely to see downward revisions to consensus estimates over the coming years amid declining rates and… The post Circle Stock Plummets By Almost 70% Post-IPO Debut, Analysts Issue Warnings appeared on BitcoinEthereumNews.com. Following a notable debut on the Nasdaq earlier this year, Circle (CRCL), the issuer of the USDC stablecoin, has experienced a significant decline in its stock value. After hitting a peak of $298 on June 23, just 18 days post-launch, shares have now dropped by 68%, trading around $82. Circle Faces Challenges As Lockup Period Approaches Despite benefiting from a softer regulatory stance on digital assets in the US with President Trump’s crypto policies, Circle faces challenges that history does not favor, particularly as it approaches the end of its lockup period.  Analysts, including Dan Dolev from Mizuho, highlighted that this lockup period prevents insiders from selling shares, typically for 180 days after an initial public offering.  Circle’s initial public offering (IPO) filing indicated that this lockup period is set to expire two days after the company unveils its third-quarter earnings, which is this Friday. Mizuho’s analysis of over 750 IPOs with market capitalizations exceeding $1 billion reveals that 58% of companies that outperform the S&P 500 prior to their lockup period tend to underperform the index in the 180 days following it. These companies see an average decline of approximately 2%.  The outlook is even bleaker for firms falling short of revenue expectations in the year after their IPOs, which tend to experience an average negative return of about 10% relative to the S&P 500. Circle may find itself in this latter category according to Mizuho. A significant portion of the company’s revenue comes from the interest on USDC reserves held in short-term US Treasuries, Treasury repurchase agreements, and cash.  Consequently, a decline in interest rates or slower-than-anticipated growth of USDC could adversely impact revenue streams. Dolev noted:  In our view, CRCL is likely to see downward revisions to consensus estimates over the coming years amid declining rates and…

                                                                               Market participants are eagerly anticipating at least a 25 basis point (BPS) interest rate cut from the Federal Reserve on Wednesday.                     The Federal Reserve, the central bank of the United States, is expected to begin slashing interest rates on Wednesday, with analysts expecting a 25 basis point (BPS) cut and a boost to risk asset prices in the long term.Crypto prices are strongly correlated with liquidity cycles, Coin Bureau founder and market analyst Nic Puckrin said. However, while lower interest rates tend to raise asset prices long-term, Puckrin warned of a short-term price correction.  “The main risk is that the move is already priced in, Puckrin said, adding, “hope is high and there’s a big chance of a ‘sell the news’ pullback. When that happens, speculative corners, memecoins in particular, are most vulnerable.”Read more