Binance buys $100 million stake in Circle, expands partnership
Binance buys $100 million stake in Circle, expands partnership Sept 22 (Reuters) - Circle CRCL.N said on Tuesday that Binance has purchased a $100 million stake in the stablecoin issuer, deepening the crypto exchange's ties with the company behind USDC, a major dollar-pegged token.
Circle shares were last up nearly 2% in premarket trading.
Here are more details:
Circle disclosed in a regulatory filing that on September 17, it issued and sold roughly 1.24 million shares to Binance at a purchase price of $80.84 per share.
Circle is the issuer of USDC, a dollar-pegged stablecoin with a market capitalization of nearly $75 billion, according to CoinMarketCap data.
Stablecoins are digital tokens designed to maintain a stable value, typically pegged to currencies such as the US dollar. They have grown popular as a faster way to move money across crypto markets and are increasingly being used for payments.
The expanded commercial arrangement has a five-year term, although either Circle or Binance can terminate it early under certain specified circumstances.
"Under the arrangements, we agreed to pay Binance a monthly incentive fee," Circle said.
The company added that Binance has agreed to undertake certain other activities to promote USDC on its platform.
Shares of Circle are up roughly 19% so far this year, giving it a market cap of about $24 billion.
(Reporting by Manya Saini in Bengaluru; Editing by Shailesh Kuber)
((Manya.Saini@thomsonreuters.com; X: manya__saini;))