Is Circle’s IPO the Start of a Stablecoin Apocalypse? Find Out! 😱

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So, former BitMEX CEO Arthur Hayes has decided to play the role of the crypto Nostradamus, warning us that Circle’s recent IPO is like the starting gun for a “stablecoin mania” bubble. Spoiler alert: he thinks it’s going to end in tears. 😢

In his latest Substack essay, he’s throwing shade at the bullish data showing stablecoin market capitalization skyrocketing to a jaw-dropping $228 billion. Because who needs optimism when you can have doom and gloom, right? 🙄

The Distribution Imperative

In a piece that reads like a financial horror story, Hayes called Circle’s public listing, which raked in over $1.1 billion, “grossly overvalued.” He’s basically saying it’s like buying a ticket to a concert that’s already sold out—good luck with that! 🎤

“The bubble will pop after the launch of a stablecoin issuer on a public market, most likely in the U.S., that separates fools from tens of billions of capital by using a combination of financial engineering, leverage, and amazing showmanship,” Hayes predicted. Sounds like a magic show gone wrong! 🎩✨

He’s got one crucial question for anyone thinking about investing in a stablecoin: how will they distribute their product? Because, you know, distribution is everything—like the secret sauce in a bad fast-food burger. 🍔

“The only question you must ask yourself when evaluating an investment in a stablecoin issuer is this: how will they distribute their product?” the market watcher asserted. Well, that’s a fun little riddle, isn’t it? 🤔

According to him, the big boys—legacy financial institutions and crypto exchanges like Coinbase—have effectively locked down the distribution channels. So, new players are basically trying to climb Everest without oxygen. Good luck with that! 🏔️

He believes social media giants like Meta and traditional banks are facing an “Extinction Level Event” from efficient stablecoins. Because nothing says “we’re in trouble” like a financial apocalypse! 💥

He pointed out Tether’s insane profitability, earned through the spread on U.S. Treasury holdings, as the shiny bait that will lure in the next wave of overvalued IPOs. It’s like watching a train wreck in slow motion. 🚂💥

“The stablecoin narrative is unique in that it has the largest most obvious TAM for a TradFi muppet,” he wrote, acknowledging the allure but predicting a “road to destruction” for those investing in new stablecoin issuers without Tether’s network effects or Circle’s cozy relationship with Coinbase. Buckle up, folks! 🎢

Booming Stablecoin Market

Hayes’ warning comes against a backdrop of undeniable sector momentum. According to CryptoQuant, the stablecoin market cap has ballooned 17% year-to-date (YTD), adding $33 billion to hit $228 billion. It’s like watching your bank account grow—if your bank account was a rollercoaster! 🎢💰

USDT added slightly more than 13% to its market cap in that period, pushing it past $155 billion. Meanwhile, USDC seems to have finally shaken off the aftereffects of its 2023 depeg crisis following the Silicon Valley Bank collapse, surging 39% to $61 billion. Talk about a comeback! 🏆

Liquidity is flooding exchanges, with ERC-20 stablecoin reserves hitting about $50 billion, and yield-bearing stablecoins recovering to $6.9 billion. It’s raining money, folks! ☔💵

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2025-06-17 20:10