Ripple, Acquisition Of Circle Derailed Despite $5 Billion Offer... Intensifying Competition For Stablecoin Market Leadership

Ripple reportedly offered up to $5 billion to acquire stablecoin issuer Circle, but Circle rejected the offer. Circle determined that the proposed amount did not adequately reflect its value, and is currently focusing on preparing for an Initial Public Offering (IPO).

Ripple has already launched its own stablecoin called RLUSD and is increasing its market share. RLUSD recently surpassed a market capitalization of $300 million and is the 12th largest stablecoin by market cap. Meanwhile, Circle's USDC, which is issued by Circle, is ranked second in the industry following Tether, maintaining a top position in the overall cryptocurrency market. If Ripple had succeeded in acquiring Circle, it could have instantly secured a dominant position in the stablecoin market.

This acquisition proposal was revealed shortly after Ripple acquired the prime brokerage firm Hidden Road for approximately $1.25 billion. Both actions demonstrate that Ripple is simultaneously strengthening its RLUSD-centered stablecoin business and expanding its global payment network.

Meanwhile, Circle recently launched a cross-border payment service, entering into direct competition with Ripple, and has also accelerated its overseas market entry, having received conditional approval for a remittance license from the Abu Dhabi Financial Authority. The moves by both companies indicate an expansion beyond simple coin issuance competition to a battle for dominance in the global payment infrastructure.

Regarding Ripple's aggressive expansion, John Deaton, a lawyer who supports XRP, expressed skepticism about CEO Brad Garlinghouse's business strategy, stating, "Next, they might buy a bank or establish one themselves."

As Ripple and Circle target the market in different ways, the failure of this acquisition suggests that the stablecoin market is becoming an area that requires sophisticated strategy and competition beyond simple asset issuance.