The current crypto bear market has not spared anyone. According to an article posted today by CoinDesk, Circle Internet Financial has publicly disclosed its’ intention to raise $250 million more to counter the effect that the bear market has had on its’ operations and finances.
Upon hearing this, the likely question on the tip of everyone’s tongues is: are they about to start a massive round of layoffs akin to what Consensys employees experienced at the end of 2018? Judging by what has been publicly disclosed, there is nothing to suggest this will happen to Circle, at least not yet.
What is more likely is that they simply need more funding to continue operating all of their various services and growing at the same time. In Circle’s case, this means running and growing the Circle Invest app, doing the same with Poloniex, which is now their in-house crypto exchange, and keeping their USD coin “stable.”
Doing one of these things is not easy. Doing all of them at once, while looking out for and pursuing attractive investment opportunities as well, is even more difficult. Achieving success while balancing all of these considerations involves staying very liquid and thus having capital that can be easily accessed as quickly as possible. Given the gravity of the bear market that we are all still experiencing, it is reasonable to expect that even Circle is hurting in this respect, especially with regards to the value of their crypto holdings.
Perhaps the main goal of their new fundraising round will be to garner $250 million to quickly shift to crypto and perhaps not. One particularly frightening possibility would be that they were pushing to raise money quickly because their USD coin’s reserves were suffering. Since their intentions were just announced on Saturday, it is hard to tell what their main motivation is at this point beyond simply surviving and thriving in the midst of a crypto market downturn.
By: BGN Editorial Staff