Aug 12 (Reuters) - Circle (CRCL.N), opens new tab posted higher revenue and reserve income on Tuesday in its maiden quarterly results since going public in June, driven by increased circulation of its USDC stablecoin and stronger subscription services.
Shares rose 5% in premarket trading, solidifying the rally that has pushed the company's stock to more than five times its initial public offering price.
Stablecoins, which are digital tokens backed by low-risk assets such as the U.S. dollar or Treasuries, have drawn increasing investor attention, especially since the Genius Act was passed last month.
The law has led some analysts to speculate that the tokens could be used for cross-border remittances and as a bridge between traditional banking and digital finance.
The momentum has helped companies such as Circle, which issues USDC, the second-biggest stablecoin by market value after Tether.
USDC in circulation grew 90% as of June 30, compared to a year earlier, the company said.
The company's revenue and reserve income grew 53% year-over-year to $658 million, thanks to a jump in the interest it earns from the cash and short-term investments backing its USDC stablecoins. Revenue from subscription and services also rose, Circle said.
It reported a net loss of $482 million, primarily due to two non-cash charges related to its IPO, including costs for employee stock awards that vested when the company went public and a higher valuation of its convertible debt following a rise in its share price.
Reporting by Niket Nishant in Bengaluru; Editing by Leroy Leo
