Circle is starting to look more like Coinbase.
Jeremy Allaire and Sean Neville co-founded Circle in 2013. It was the first company to earn a BitLicense, the new operating license bestowed on a select few cryptocurrency companies by the New York Department of Financial Services. Circle’s peer-to-peer payments app originally operated only in bitcoin and offered buying and selling of bitcoin, so the app was generally framed as a Venmo for bitcoin.
But in 2016, Circle rebranded its main app Circle Pay and ended its support of buying bitcoin within the app, though it continued to use the bitcoin blockchain for its back-end rails. At a conference in New York, Jeremy Allaire even declared, “It’s highly unlikely that any of us will be using bitcoin in five to ten years.” Tech media wrote that Circle “gave up on bitcoin.”
Fast forward to 2018. Circle has quietly expanded its portfolio of crypto products, and is starting to look like a full-service crypto investment firm.
Circle has four distinct products: Circle Pay, its original fast money-transfer app a la Venmo; Circle Invest, which offers buying and selling of seven different cryptocurrencies (bitcoin, ether, bitcoin cash, litecoin, monero, ethereum classic, and Zcash); Circle Trade, an institutional trading desk that provides liquidity to large crypto exchanges and investors; and Poloniex, a US bitcoin exchange Circle acquired in February.
“We never left bitcoin,” says Circle president Sean Neville. It’s a statement big bitcoin believers might dispute based on the company’s history. “We believe in bitcoin. Everything that we’re doing is based on crypto assets and underlying blockchain technology. We’re not necessarily bitcoin maximalists, it’s not necessarily the perfect thing for everything that we’re doing, but it’s extremely valuable and a core component of what we’re doing.”
Speaking to Yahoo Finance back in February, Circle CEO Jeremy Allaire rattled off a list of Circle’s competitors: “In the social payments space, it’s companies like Square Cash or Venmo. In cross-currency payments, which we enable people to do instantly for free, it might be a company like TransferWise. Circle Invest, which is not yet launched, will compete certainly with products like Coinbase.com, or Robinhood’s latest crypto offering.”
But it is Coinbase, the No. 1 mainstream crypto brokerage in America with 20 million users, that Circle appears to be setting its sights on more than any other competitor.
Coinbase is the best-known choice for newbies who want to dip a toe into bitcoin. Neville describes Circle Invest in the same terms: “It’s aimed at someone who wants to get involved in trading crypto assets but needs somewhat of a guided experience. We provide things like custody. It’s a really simple way to acquire multiple kinds of tokens in just a couple of taps.”
As for the growing crypto competition, Neville says, “I think a lot of us are kicking the shins of the same giants together. If we think about this as a new internet for finance, there need to be multiple players… There’s room for a lot of experimentation and collaboration, even though there is competition.”
Last month, Circle added a “buy the market” feature on its Circle Invest app that lets users simply choose an amount to invest and disperse it equally into all seven coins Circle Invest currently supports. Robinhood Crypto has a similar feature; Coinbase, for now, does not.
Daniel Roberts covers bitcoin and blockchain at Yahoo Finance. Follow him on Twitter at @readDanwrite.