Shares of Circle Internet Group (CRCL -8.71%) took a 28.1% hit in August 2025, according to data from S&P Global Market Intelligence. The group behind the USDC (USDC -0.00%) stablecoin posted its first earnings report as a public company in the middle of the month, and it wasn’t strong enough to support Circle’s early price jump.

Circle’s earnings landed with a thud

From the initial public offering (IPO) on June 4 to the end of July, Circle’s stock had gained a hair-raising 492%. Investors were watching the first earnings report closely, looking for signs that Circle’s business could sustain a $42.0 billion market cap.

But that bullish outcome wasn’t in the cards. Sure, the results were impressive, given that Circle’s core business is based on an asset that will always be worth $1 per coin. Revenue rose 53% year over year to $658 million as the active circulation of USDC nearly doubled to $61.3 billion. But Circle still posted a net loss of $482 million in the second quarter, largely due to costs associated with the IPO. The price spike itself was the root cause of these charges, as the skyrocketing stock price changed the value of Circle’s convertible debt and stock-based compensation policies.

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The boring banking secret behind Circle’s exciting revenue

It may sound strange that Circle generated a $658 million revenue stream in the second quarter, even though the USDC stablecoin neither gained nor lost any value. But the company operates much like a classic bank — it earns interest on the dollar-based funds that provide direct backing for the stablecoin. These interest payments accounted for 96.4% of Circle’s total revenue in the second quarter.

As for the stock’s price drop, it should be noted that the slide started well before Circle’s earnings report. As of Sept. 2, Circle’s share price is down 54.4% from the absolute peak on June 23. The big surge followed by a steep price drop is pretty common for big-name IPOs, and Circle was one of the most anticipated market launches in recent memory.

Only CoreWeave (CRWV -9.41%) and Figma (FIG -6.70%) have seen splashier IPOs in 2025, and they have indeed followed similar charting patterns. Figma’s stock is down 46.2% from a soaring peak just after its IPO in July, while CoreWeave took a couple of months to build a 359% gain and then lose nearly half of it.

I rarely jump on IPO launches, because early investors tend to get burned rather quickly. Circle provided yet another example of a well-worn charting drama. And I’m not entirely convinced that Circle’s cool-off period has ended yet. You should probably avoid this red-hot financial technology stock until it stabilizes at a more plausible valuation.

ProShares Trust and Bitwise each filed preliminary prospectuses with the Securities and Exchange Commission (SEC) on June 6 for exchange-traded funds (ETF) designed to track Circle’s CRCL shares.

The ProShares Ultra CRCL ETF is a 2x leveraged product that seeks to deliver twice the daily move in CRCL by utilizing swaps and other derivatives, as stated in the Form N-1A registration.

Bitwise’s CRCL Option Income Strategy ETF proposal would hold the stock and sell call options against the position to generate distributable cash, serving as a “covered call.”

Neither filing listed a ticker or fee schedule, and both target an effective date of August 20 under Rule 485(a)(2).

Each issuer must file a final prospectus, obtain exchange listing approval, and secure exemptive relief for the use of derivatives before its shares can be listed. 

If the SEC declares the statements effective on the default August timetable, the products could begin trading late in the third quarter.

Filings amid explosive growth

Circle’s equity changed hands at $117.49 as of press time, giving the company an implied fully diluted value of over $30 billion. The value is about half of the $61 billion market capitalization of USDC, the dollar-denominated stablecoin that Circle issues. 

Furthermore, CRCL printed a fresh all-time high of $138.57 on June 9 before correcting.

Circle priced its initial public offering at $31 on June 5. Trading opened at $69, spiked to $103.75 within 30 minutes, and closed the day at $83.23. 

The next session saw the share price recover to a record $123.52 and finish above $100, a level it has maintained since. 

The stock’s performance has drawn quick interest from companies seeking differentiated exposure tied to crypto-native revenue streams and even considering their own initial public offerings (IPOs).

The twin filings highlight immediate demand for packaged exposure to Circle’s equity as traditional asset managers bridge public-market wrappers with businesses rooted in stablecoin economics.

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