Is the stablecoin bubble already inflating

Circle, the issuer of USDC, went public recently – and like we covered here, they killed it.

The stock shot up nearly 400% above the IPO price.

Naturally, that kind of success has others jealous. And BitMEX founder Arthur Hayes thinks we’re about to see a bunch of stablecoin companies trying to copy Circle’s move.

It’s kind of like my cousin Ricky when we were five. He saw how cute my dog looked with a collar and immediately threw a tantrum begging his mom to get one for his pet too.

He owned fish. Damn right. He was begging for a fish collar.

And just like Ricky’s idea flopped (duh), Hayes says most of these Circle copycats won’t survive.

He expects investors to get hyped, throw money at flashy-sounding stablecoin startups, and then lose the money when those projects can’t deliver.

Hayes explains like this: it’s not enough to have a good stablecoin – you need distribution. The stablecoin’s gotta reach millions of users to be successful.

And that can be done in one of three ways:

👉 Through major crypto exchanges (like Binance or Coinbase),

👉 Through Web2 giants (like Meta, X, or Google),

👉 Or through traditional banks.

Exhibit A: Tether succeeded because it had distribution through Bitfinex.

Exhibit B: Circle only started popping off after getting a deal with Coinbase – and even then, they have to give Coinbase half their earnings for access to its users.

Hayes says any new stablecoin startup will struggle to match that.

All the big exchanges have already picked their partners, and no one’s waiting around to help newcomers.

As for banks and tech giants, they’ll just build their own solution – a trend we discussed yesterday.

Because of that, Hayes doesn’t see a bright future for new stablecoin IPOs. He thinks most of them will burn investor money, flop under pressure, or fade out when the excitement dies down.

But he also says don’t short them. During speculative mania moments, even the worst stocks can go vertical.

Basically, the hype might drive prices up, but don’t mistake momentum for long-term value.