TLDR
- Circle stock has dropped over 55% from its June high of $300.
- Coinbase stock has declined by 25% over the past month.
- Circle announced a secondary offering of 10 million shares worth $1.4 billion.
- CEO Jeremy Allaire sold 357,812 shares of Circle stock for $45.5 million.
- Technical analysis shows Circle may fall further toward the 100 dollar mark.
Crypto stocks Circle (NYSE: CRCL) and Coinbase (NASDAQ: COIN) plunged ahead of Jerome Powell’s Jackson Hole speech on Friday. Both stocks dropped significantly this week amid rising macro concerns and reduced hopes of a Fed rate cut in September. CRCL lost over 12%, while COIN declined by nearly 7% as market sentiment shifted quickly.
Circle Faces Insider Selling and Valuation Doubts
Circle stock (CRCL) continued its sharp correction, trading at $131.80 by Thursday’s close, falling over 55% from June highs. The sharp decline follows a sideways trend as crypto stocks weaken before the Federal Reserve’s Jackson Hole update. Despite launching the Arc Layer-1 blockchain and posting strong Q2 results, investor caution persists.
Company filings show Circle plans to issue 10 million shares in a secondary offering, worth $1.4 billion. Of this, 8 million shares come from existing shareholders, including CEO Jeremy Allaire. “Allaire sold 357,812 shares worth $45.5 million,” reports confirmed, which raised doubts about internal confidence.
Technical analysis from Ali Martinez indicated a breakdown below key support, pushing CRCL closer to the $100 target. He said, “Lower Fibonacci levels now suggest a 25-30% decline ahead,” highlighting a bearish pattern. This sentiment weighs on crypto stocks as institutional enthusiasm slows.
Coinbase Reverses Gains After Deribit Deal
Coinbase stock (COIN) erased recent gains, falling back below its IPO price and marking a 25% loss over the past month. This reversal comes despite Coinbase’s $2.9 billion acquisition of crypto derivatives platform Deribit in early August. However, momentum has stalled as crypto stocks now mirror Bitcoin’s volatility.
According to blockchain platform Ecoinometrics, COIN’s price continues tracking Bitcoin’s movement, which remains under macro pressure. With BTC struggling and inflation data still sticky, crypto stocks like Coinbase lost direction. The failed breakout above the IPO level now appears to be short-lived.
Moreover, the correction erased optimism from Coinbase’s earlier bullish setup, leading to fading volume and investor withdrawal. Derivatives expansion hasn’t offset market headwinds, keeping COIN under strong selling pressure. Thus, even strategic deals have failed to protect crypto stocks from macro drag.
Fed Uncertainty Pressures Crypto Stocks Marketwide
Market focus now shifts to Jerome Powell’s speech at Jackson Hole, which is expected to give signals on September policy decisions. Following sticky inflation data, analysts say, “Chances of a rate cut in September have dropped to 70%. ” Fed uncertainty has directly pressured crypto stocks across the board.
Crypto markets usually respond to monetary loosening, but persistent inflation has forced investors to reassess Fed outlook. Powell faces a tough choice between fighting inflation or supporting growth, both of which impact crypto stocks’ performance. Until then, volatility remains the dominant trend.
Crypto stocks are reacting not just to crypto-specific factors, but broader monetary dynamics. Both Circle and Coinbase now reflect growing investor discomfort, despite internal growth moves. The sector remains highly sensitive to the Federal Reserve’s next steps.
