Crypto industry heavyweight and BitMEX co-founder Arthur Hayes has sounded the alarm over what he describes as an impending “stablecoin mania,” warning that a wave of new stablecoin companies attempting to emulate Circle’s IPO success are likely to be overvalued and doomed to fail.
In a sharply worded blog post on June 16, Hayes argued that Circle’s June 5 listing—which has seen its share price soar over 80% to nearly $165—signals the beginning of a speculative frenzy, not a new era of sustainable growth in the stablecoin sector.
“Assume the Position” is a discussion on the stablecoin mania brewing in public stock markets. If you want your bowel movements to stay regular, read on.https://t.co/ceiUbuufAe pic.twitter.com/aapX8nv6Dm
— Arthur Hayes (@CryptoHayes) June 16, 2025
“The listing marks the beginning, not the end of this cycle’s stablecoin mania,”
Hayes wrote. He predicts the eventual collapse of the bubble will come after a major public launch by a stablecoin issuer that dazzles investors with “financial engineering, leverage, and amazing showmanship” — but ultimately separates them from billions in capital.
Labelling the next batch of public stablecoin firms as “Circle copycats,” Hayes warned retail and institutional investors alike to tread carefully.
“Trade this shit like you would a hot potato,”
he said, noting that despite their likely flawed fundamentals, these companies’ stocks will likely rally—at least initially—on the back of strong pro-crypto sentiment and media hype.
That legislation could arrive as soon as today, with the U.S. Senate scheduled to vote on a key stablecoin regulatory bill. Chainlink co-founder Sergey Nazarov backed Hayes’ expectations, saying that the passage of the bill would likely trigger a global wave of stablecoin launches.
However, Hayes emphasized that the success of any stablecoin issuer hinges on one thing: distribution. He identified just three viable channels—crypto exchanges, Web2 social media platforms, and traditional banks—arguing that without access to at least one of these, new entrants have “no chance of success.”
Even Circle (CRCL) itself, he argued, is “insanely overvalued” at its current price point, pointing to the fact that it hands over half of its interest income to Coinbase. Circle also increased the size and pricing of its upcoming public offering, now aiming to raise approximately $1.05 billion as it prepares to list on the New York Stock Exchange (NYSE)
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