The global surge in stablecoin interest has driven the stocks of emerging tech companies significantly higher. Circle (CRCL, Financial), known as the "first stablecoin stock," has seen its share price skyrocket by approximately 500% since its New York listing three weeks ago. However, short positions on Circle are also rising.
In South Korea, global and local funds are offloading shares of Kakaopay Corp., which have doubled in the past month. This cautious trading contrasts with the enthusiasm of retail investors. Despite regulatory caution, strong support from former U.S. President Donald Trump has fueled the stablecoin boom.
Circle's market cap has exceeded $40 billion, surpassing more than half of the companies in the S&P 500. Meanwhile, Kakaopay's stock performance in Seoul has outpaced its peers in the FTSE Global Fintech and Blockchain Index, nearly doubling Robinhood's (HOOD) gains. Yet, institutional investors remain net sellers.
Despite the backing of leaders like Trump and South Korean President Lee Jae-myung, risks persist. The Bank of Korea has warned about stablecoins potentially hindering effective monetary policy. While the technology holds promise, high valuations of related stocks have raised concerns.
