Circle Becomes 'Bitcoin Unicorn' with Bitmain-Backed Mega-Round

The 'bitcoin unicorn' club now has another member.

Announced Tuesday, Circle has closed a $110 million Series E fundraising, a figure that effectively values the startup at nearly $3 billion, according to figures from the company. Led by China-based mining outfit Bitmain, the round includes support from Accel, Blockchain Capital, Breyer, Digital Currency Group, General Catalyst, IDG, Pantera and Tusk Ventures.

With the funding, the company is also revealing an ambitious plan to bolster its products and services by launching a "US dollar coin," or a blockchain native asset that would be both regulated and backed by real government currency, through its affiliate CENTRE project.

In this way, Circle CEO Jeremy Allaire framed the round as one that helps it position itself as a true conglomerate of cryptocurrency services, as opposed to just an exchange or payment startup, both characterizations having been given to the company in the past.

More than a technical novelty, Allaire positioned the stablecoin project as essential to Circle's maturation and continued expansion, painting it as integral for its mobile payments application, its over-the-counter (OTC) trading business and its exchange service.

The launch also comes at a time when Silicon Valley investors have shown a preference for investments in such products, owing to the massive role stablecoins play in facilitating global cryptocurrency exchange and the perceived issues with today's market leaders.

It's this vision, Allaire said, that made Bitmain, the controversial cryptocurrency mining giant, a natural fit to lead the funding round.

All told, the funding will also help boost staffing at Circle, which today employs more than 200 employees globally in locations including Boston, San Francisco, Dublin, London, Paris, Madrid, Hong Kong, Beijing and Shenzhen.

A new twist on stablecoins

But while Circle's funding round and valuation are likely to grab a majority of headlines, it's perhaps its launch of a US dollar cryptocurrency initiative with participation from Bitmain that may most impact the crypto market.

As noted by Allaire, the play is a strategic one that finds Circle taking aim at one of the most important elements of the crypto economy.

The vision is that regulated financial institutions, whether they're a crypto exchange or a money transmitter, would be authorized by CENTRE to become issuers of stablecoins, and that many issuers could offer and manage different fiat-backed cryptocurrencies.

"Circle can be an issuer of US dollar coin, Square could be an issuer. If I got US dollar coins from Circle, I could transmit those to another digital wallet for an issuer," he explained.