In a move that’s turning heads across both Wall Street and the crypto sector, Ark Invest, the investment firm led by Cathie Wood, has sold over $51 million worth of shares in Circle Internet Group (CRCL), the company behind the USDC stablecoin. This divestment comes on the heels of Circle’s remarkable stock rally—up nearly 400% since its IPO debut earlier this month—and amid growing debate over the company’s soaring valuation.
Details of the Sale
On June 16, Ark Invest offloaded 342,658 CRCL shares, valued at approximately $51.7 million based on the day’s closing price of $151.06. The sale spanned three of Ark’s ETFs: ARK Innovation ETF (ARKK) sold 196,367 shares, ARK Next Generation Internet ETF (ARKW) sold 92,310 shares, and ARK Fintech Innovation ETF (ARKF) sold 53,981 shares. This move signals a strategic rebalancing as Circle’s stock price has surged well beyond initial expectations .
Circle’s Meteoric Rise
Circle’s IPO has been one of the most talked-about events in fintech this year. The company’s shares skyrocketed from an IPO price of $31 to over $150, pushing its market capitalization to around $36 billion. This surge is largely attributed to Circle’s dominant position in the stablecoin market—USDC is the second-largest stablecoin globally, with a market cap exceeding $61 billion .
The rally also reflects broader investor enthusiasm for blockchain infrastructure and digital dollar assets, especially as U.S. regulators intensify their focus on the stablecoin sector .
Valuation Concerns and Market Skepticism
Despite the excitement, not everyone is convinced that Circle’s valuation is sustainable. Arthur Hayes, Chief Investment Officer at Maelstrom, has publicly questioned the fundamentals behind the rally, calling Circle “grossly overvalued.” Hayes warns that the current hype could attract a wave of copycat stablecoin projects with weak business models, reminiscent of past market bubbles. He suggests that if regulatory oversight remains light, the sector could see a repeat of the instability that led to the collapse of projects like TerraUSD.
“To be clear, Circle is grossly overvalued, but the price will continue levitating.” — Arthur Hayes
Hayes further cautions that the bubble could burst if new public stablecoin issuers use financial engineering and aggressive marketing to attract capital without solid fundamentals.
What’s Next for Circle and the Stablecoin Sector?
Circle’s IPO has set a new benchmark for crypto companies entering public markets, but its sky-high valuation and the rapid influx of investor capital have also raised red flags. As the stablecoin sector matures and regulatory frameworks evolve, investors will be watching closely to see whether Circle can maintain its momentum—or if the market will correct as competition intensifies and scrutiny increases.
