There is a new development in Ripple's (XRP) agreement that will go down in history if it happens! Another company has entered the fray.

Circle Internet Financial, one of the important companies in the Crypto currency market, is in talks with Coinbase and Ripple for a possible acquisition ahead of its public offering (IPO).

According to banking and private equity sources, Circle rejected Ripple's estimated $4-5 billion offer, which is believed to consist of XRP and cash components, as insufficient.

The issuer of the USDC stablecoin, Circle, submitted the necessary documents for its long-awaited IPO in April to the US Securities and Exchange Commission (SEC). However, the IPO plans may not materialize. Sources close to the company report that Circle has been conducting informal discussions for a sale to either Coinbase, the largest crypto exchange in the US, or payment company Ripple in recent weeks.

According to four banking and private equity managers familiar with the discussions, Circle is expecting a bid of at least $5 billion, which is the valuation it aims for in its IPO. One source said, "If Coinbase wanted to buy, Circle would sell without a second thought." Another source mentioned that the process is quite volatile and stated, "Things are changing every week."

It is stated that Circle is still bound to the public offering process. However, a roadmap for the IPO has not yet been announced, and the investor roadshow has not yet started.

The relationship between Coinbase and Circle dates back. The two companies established a joint venture called the Centre Consortium for the issuance of USDC in 2018. When this partnership ended in 2023, Coinbase acquired shares from Circle, while all management control of USDC passed to Circle. However, the companies still profit together from USDC reserve revenues.

According to the S-1 documents submitted by Circle to the SEC, the two companies share 50% of the USDC reserve revenue, while Coinbase receives all the revenue generated from USDC held on its platform. Recent financial data shows that such revenues are on the rise for Coinbase.

Additionally, under the current agreement, Circle cannot make new distribution or partnership agreements regarding USDC revenues without the approval of Coinbase. This also means that Coinbase has significant control over Circle.

It was reported that Ripple's offer of 4 to 5 billion dollars to acquire Circle was deemed insufficient and rejected. According to Bloomberg's news in April, this offer is believed to consist of XRP and cash components. Ripple's financial strength is quite remarkable: The company holds 4.56 billion XRP ( approximately 11.77 billion dollars ) and a trust reserve containing 37.13 billion XRP ( approximately 95.7 billion dollars ).

However, analysts indicate that Coinbase, a publicly traded company, could quickly raise capital through stock sales or borrowing if necessary, thus becoming a more attractive buyer. It is known that Coinbase had $8 billion in cash on its balance sheet as of the end of March.