Arca Chief Investment Officer Jeff Dorman said the digital investment company has sold all of its Circle shares following the stablecoin company’s recent listing on the New York Stock Exchange.
The update followed a scathing open letter published by Dorman on social media on June 5, criticizing Circle for giving the investment firm a “throwaway” allocation in Circle’s initial public offering (IPO).
According to Dorman, Arca submitted an order for $10 million in Circle shares in April 2025 and only received a $135,000 allocation despite being a long-time supporter and one of the earliest investors to submit a bid. The executive wrote in a now-deleted letter:
“We pinged you separately two months ago indicating our order, and you thanked us for the support. If you were going to f[***] us at the end, the least you could have done was tell us two months ago so we didn’t waste our analysts’ and ops teams’ time on a deal that you had no intention of allocating shares to us.”
“Arca is closing all of our accounts with Circle and will tell every single dealer we work with that we will no longer accept USDC,” Dorman continued.
Cointelegraph reached out to Circle for comment on the letter but hadn’t received a response by the time of publication.
Circle’s public listing is a significant development in the crypto industry as the issuer of the world’s second-largest stablecoin, Circle-USD (USDC), with a total market capitalization of over $61 billion, now has access to the world’s deepest capital market.
Circle lists on the NYSE to trading frenzy
Circle began trading on the NYSE on June 5 under the ticker CRCL, following an IPO that raised $1.05 billion.
The company’s shares surged by 167% on its debut, closing out the trading day at $82.
The stock continued the rally on June 6 and is currently trading hands around $115 per share during intraday hours.
Quick Summary of the News:
- Arca, a digital asset investment firm, sold all its Circle shares after the company’s NYSE listing.
- This followed a public letter from Arca’s CIO, Jeff Dorman, criticizing Circle’s IPO allocation to the firm.
- Arca had requested $10 million in shares but received only $135,000.
- Dorman stated Arca will close its accounts with Circle and no longer accept USDC.
- Circle’s IPO raised $1.05 billion, and its stock price has seen significant gains since its debut.
Why It Matters:
Arca’s move, while seemingly driven by frustration, highlights the importance of transparency and fairness in IPO allocations, especially within the tightly-knit crypto community. A vocal firm like Arca publicly denouncing USDC acceptance, even if temporary, raises questions about trust and potentially impacts USDC’s perception, although the actual financial impact is likely minimal given Circle’s size and trading volume.
Market Impact:
While the long-term impact remains to be seen, here’s a snapshot of USDC’s market position:
| Metric | Value |
|---|---|
| USDC Market Cap | Over $61 Billion |
| Ranking by Market Cap (Stablecoins) | 2nd Largest |
Despite the incident, USDC maintains a strong market position. However, consistently negative publicity could erode confidence over time.
Expert Take/Personal Insight:
Dorman’s reaction, while perhaps extreme, reflects a sentiment felt by many smaller firms in the crypto space: a feeling of being overlooked in favor of larger institutional investors. It underscores the need for companies like Circle, particularly after going public, to maintain positive relationships with all stakeholders, regardless of size. Circle’s silence following the accusation isn’t helping the matter. A public statement addressing the issue would be a wise move.
Actionable Insight:
Traders and investors should monitor USDC’s trading volume and on-chain data (e.g., minting/burning activity) for any signs of unusual activity. Keep an eye on social media sentiment surrounding USDC; sustained negativity could lead to increased volatility. Also, watch for any official response from Circle regarding Arca’s allegations.
Conclusion:
Arca’s decision to dump its Circle shares and publicly criticize the company is a noteworthy event. While not likely to cause a major disruption to USDC’s stability in the short term, it serves as a reminder of the importance of transparency, fair dealing, and strong communication in the crypto industry, particularly as it continues to mature and attract mainstream attention. The market will be watching to see how Circle responds and whether this incident will have any lasting repercussions for USDC adoption.