Jack Dorsey’s Circle receives $400M from BlackRock, Fidelity, and others

The crypto-focused financial technology company, Circle, which is founded by Twitter’s Jack Dorsey, has announced that it has entered an agreement with big names for a $400 million funding round. The round is expected to close by the end of June 2022. The major investors in the round include BlackRock, Fidelity Management and Research, Fin Capital, and Marshall Wace.

Apart from the capital raise, BlackRock has also formed a strategic collaboration with Circle to operate as its principal asset manager for USDC cash reserves and to explore capital market possibilities for its stablecoin, among other goals. 

The co-founder and CEO of the company, Jeremy Allaire said during an interview that the company’s major strategic partnership with BlackRock will enable it to “explore new use cases where USDC may be an efficient resource in the financial services value chain.”

Circle to expand its development scope

Circle said in a statement that the new capital will be used to support the firm’s operational development “as demand for dollar digital currency and related financial services continues to scale globally.”

According to CoinMarketCap data, USDC, which was co-founded by Circle and Coinbase, is the second-largest stablecoin following USD Tether (USDT) and the fifth-largest crypto token by market cap. Its market capitalization increased by about 370 percent year over year, from $10.82 billion to $50.83 billion. Around $5 billion in volume was exchanged in the last 24 hours, an increase of more than 39%.

Known for its cooperative attitude towards regulators, last year the company said that it supports plans to regulate stablecoin issuers as banks.

Although USDC ranks second among stablecoins, it has a market cap of about $32 billion less than USDT and a 24-hour volume of nearly $73.6 billion less than the top stablecoin.

“This is a milestone moment for Circle and part of the “coming of age” of crypto,” according to Allaire. He noted that Circle is working to broaden the usage of USDC and blockchain technology in payments, commerce, and financial applications.

In February, Circle revised its merger agreement with Concord which resulted in it doubling its valuation to $9 billion.