Circle Has a $10.6 million Investment in FTX Group

According to a new regulatory filing, Circle disclosed that it made $10.6 million in investment in the FTX Group.

The firm tends to not reveal the investments

The company has been very active in other projects, even though it doesn’t disclose how much it has invested.

“Circle is a tiny equity holder of FTX, and FTX is a tiny equity holder of Circle.  Circle is also a tiny equity holder of Kraken, Coinbase and BinanceUS,” tweeted Co-founder & CEO of Circle, Jeremy Allaire. 

In the context of Circle, the $10.6 million is probably not a big deal.

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According to Decrypt which was told by Circle that while Allaire would have known the amount Circle invested in FTX, he would not have disclosed that number in his Twitter thread last week about the “FUD” surrounding Circle’s relationship with FTX.

The Circle spokesperson added “As a rule, we don’t publicly disclose investments unless they are material to Circle, which FTX was not. Given we are in registration and the heightened focus on the impact of FTX, we disclosed our investment in our most recent S4.”

The firm never made loans to FTX or Alameda

Circle’s CEO tweeted on November 9 that no loans were made to FTX or Alameda  “and has never received FTT as collateral, and has never held a position in or traded FTT.  In any case, Circle does not trade on its own account.”

4/ Circle has never made loans to FTX or Alameda, and has never received FTT as collateral, and has never held a position in or traded FTT. In any case, Circle does not trade on its own account.

— Jeremy Allaire (@jerallaire) November 9, 2022

The CEO previously said Circle has no material exposure to FTX and Alameda. However, FTX has been using Circle Payment APIs for the past 18 months to provide customer transactions involving cards and ACH. For liquidity for BTC/ETH transactions, Circle’s beta crypto payments product uses FTX and other exchanges.

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“Alameda has been a customer of Circle for many years, using Circle’s USDC service for creating and redeeming USDC.  They have the exact same product and same terms of use as all of our institutional customers,” he explained.

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