Circle is searching for a buyer for SeedInvest, its crowdfunding unit, as the Boston-based crypto company doubles down on its stablecoin efforts, The Block has learned.
It’s the latest in Circle’s downsizing saga, which kicked off last year with the spin-out of Poloniex, the cryptocurrency exchange it acquired for $400 million in 2018. In December, Circle sold its over-the-counter trading desk to cryptocurrency exchange Kraken in a deal one investor described as a “fire sale for approximately $1 million.”
On Wednesday morning, The Block reported that Voyager is set to acquire Circle’s retail trading app Circle Invest in an all-stock deal. As part of the deal, Voyager will issue its common shares to Circle, representing a nearly 4% ownership stake.
That leaves Circle with SeedInvest – but the firm is looking to unload it as well as it focuses on new initiatives relating to USDC and stablecoins, two sources told The Block, one of whom was briefed on the sale efforts. USDC is managed by a consortium called CENTRE, of which Coinbase is also a member.
Circle acquired SeedInvest in a bid to execute on its vision of expanding into the tokenization of financial assets, which could help companies raise funds. The acquisition closed in March 2019, as reported by CoinDesk. A person familiar with the situation told The Block that Circle is having a hard time finding a buyer because there are lingering issues with how the original acquisition was structured.
“The deal is very hairy; so I’m sure anyone looking at the deal is turned off because it’s not easy to digest,” the person said. A spokesperson for Circle declined to comment.
Insiders who spoke with The Block lamented the unraveling of Circle.