- Circle insiders sell $1.4 billion in shares just two months post-IPO, following a 349% stock price surge.
- JPMorgan waived the standard lock-up period, permitting early investors including CEO Allaire to sell 8 million shares.
Executives and early investors at Circle, the stablecoin issuer, are selling $1.4 billion worth of company shares just two months after its initial public offering in early June. This move comes following a rapid 349% increase in Circle’s stock price.
The sale involves 10 million shares. Circle itself will sell 2 million shares, while shareholders, including CEO Jeremy Allaire, will sell the remaining 8 million. This transaction was announced Tuesday.
Typically, early investors face a “lock-up” period preventing immediate sales after an IPO, often lasting until year-end. However, lead underwriter JPMorgan Chase waived this restriction for Circle. The waiver allowed the share sale to proceed while investor interest in new crypto-related stock listings was high, according to Bloomberg reports. Marketed over just two days, it attracted more buyers than shares available and is expected to set final prices by Thursday. Circle has not publicly commented on the sale.
Although Circle’s stock trades well below its peak of $298.99 reached on June 23rd, it remains substantially above its initial IPO price. The $1.4 billion value of this insider sale exceeds the total funds Circle raised in its June IPO.
David Erickson, a Columbia Business School finance professor and former Barclays executive, described the action as “a cash-in exercise,” directly referencing the stock’s steep climb since going public. He noted sellers will likely accept a lower price than recent trading levels, but emphasized that after a 400% gain, the discount is minor; sellers still secure large profits.
Other companies like Karman Holdings, Viking Holdings, UL Solutions, and StandardAero also conducted share sales before their lock-up periods ended in 2024. Circle’s sale, however, occurs faster after its debut than these others.
