Circle surpasses Coinbase market cap

The Block reported that USDC stablecoin issuer Circle (CRCL) has surpassed the market cap of not only USDC but also Coinbase (Nasdaq: COIN) as its stock price surpassed $298 during Monday’s trading. Regarding this, Alexander Blume, CEO of digital asset fund Two Prime, explained that Circle’s market cap exceeding Coinbase’s market cap makes no sense given that Coinbase captures half of Circle’s revenue and operates various other business units. He described the current valuation as abnormal and forecast that the stock will eventually find its way back to reality. Circle paid more than 60% of its USDC reserve income to Coinbase this year. Under the current contract, any increase in USDC supply or an increase in interest rates will immediately lead to an increase in Coinbase’s profits, the Block outlined. CRCL is currently trading at $263.25, up 9.5% since the previous day’s trading.