Written by: Da Yu

Circle is the stock I follow most closely , and I've always believed that only players from other fields can truly understand this company. I've written a lot about it, but the investor I find most impressive is Sister Wood. Her operations on this stock are textbook examples: from "buying at the opening" to "selling at the high" and then "buying back at the low," she made hundreds of millions of dollars in profit.

Interestingly, she is not a swing trader; she is the kind of person who looks at the long-term narrative and holds for the very long term, ignoring fluctuations. However, her actions on this particular stock make me feel that she has a very clear grasp of short-term fluctuations—so clear that even a long-term holder has to make some simple adjustments.

With QNT about to be launched, it's a good opportunity to review Mu Tou's actions on Circle.

I. Opening Price Surge: Why can a newly listed stock double in price before the market opens?

Circle's IPO involved offering 34 million shares at $31, raising approximately $1.1 billion. The underwriting syndicate (led by JPMorgan Chase, Citigroup, and Goldman Sachs) initially set a price range of $24 to $26, later revised it to $27 to $28, and finally settled on $31—the upward price adjustment itself is a signal of strong demand.

According to Bloomberg, the offering was oversubscribed by about 25 times ; BlackRock also plans to take 10% of the offering.

What truly determines the opening price jump is the circulating shares.

Circle had a total share capital of approximately 223 million shares at the time of its IPO, but only 34 million publicly offered shares, representing about 15% of the total share capital , are actually traded on the market. The remaining approximately 85% of the shares, held by the founders, early investors, and employees, are locked up and cannot be sold in the short term.

Supply was capped at a mere 34 million shares, while demand was overwhelmingly high, with oversubscription reaching 25 times. These two factors combined forced the price to jump upwards to find equilibrium. Circle opened at $69 (123% higher than the offering price), briefly touched $103.75 (235% higher) during the day, and closed at $83.23 (168% higher).

This 168% first-day gain is the highest among US IPOs exceeding one billion US dollars in more than 30 years .

This is the physical structure of a "price surge at the opening": a popular sector, a small circulating share capital, and high oversubscription. When these three elements are combined, a sharp price gap at the opening is inevitable . It has no direct relation to whether the company is worth the price; it's purely because in the short term, "money that wants to buy" far exceeds "shares that can be sold."

However, the lock-up period won't last forever. Once the locked 85% is released, the extreme supply-demand imbalance at the time of the market opening will gradually be filled, as evidenced by Circle's subsequent sharp drop.

II. Sister Wood's Three Steps: Subscription, Delivery, and Buyback

Sister Mutou's optimism about Circle wasn't a judgment she made on the day of the IPO. ARK has long been betting on crypto assets and digital financial infrastructure, and she herself has repeatedly expressed her optimism about stablecoins publicly. Therefore, she started working on this deal before the IPO.

1. Pre-IPO: Acquire core shares at the offering price

In Circle's prospectus, ARK expressed its intention to subscribe, planning to purchase up to $150 million worth of shares in the offering. Ultimately, it acquired approximately 4.49 million shares, distributed across three actively managed funds: ARKK, ARKW, and ARKF. Based on the offering price of $31 per share, the cost was approximately $139 million, essentially reaching its self-imposed subscription limit .

To fund its Circle bet, ARK sold off some of its other crypto-related holdings on the day of the IPO: approximately $39 million in Coinbase (COIN), approximately $18.5 million in Robinhood (HOOD), and approximately $10.4 million in Block (XYZ). It did not add any new crypto exposure; instead, it shifted its position from other crypto assets to Circle.

On its first day of trading, the stock closed at $83.23, making ARK's 4.49 million shares worth approximately $373 million. Media outlets generally reported this as "ARK buys $373 million worth of Circle shares." However, this $373 million figure represents the closing value of the holding, not her cash cost. What she actually paid was the IPO price of approximately $139 million. Before ordinary investors even had a chance to access the shares in the primary market, her investment had already more than doubled. This profit was exclusively enjoyed during the "opening surge" period when shares were allocated at the IPO price.

The first price that ordinary investors saw in the secondary market was $69, while ARK's cost was close to $31.

2. With policy support, shipments...

Circle's stock price soared after its IPO. What truly propelled it to new heights was policy.

On June 17, 2025, the U.S. Senate passed the ** GENIUS Act ** (Stablecoin Act) by a vote of 68 to 30, establishing a regulatory framework for dollar-denominated stablecoins at the federal level for the first time. Following the announcement, Circle's stock price surged 33.8% on June 18, closing at $199.59; it continued to rise on the 20th; and on the 23rd, it reached an intraday high of $298.99, its highest price to date, corresponding to a market capitalization of approximately $66 billion. It's worth noting that at that time, the total circulating supply of USDC was approximately $61.7 billion, meaning that Circle's equity was once worth more than all the stablecoins it issued combined.

Amid this policy-driven market trend, Sister Mu began systematically reducing her holdings.

The first sale occurred on June 16th, involving approximately 340,000 shares at the closing price of $151.06 that day. Subsequent sales occurred on the 17th, 20th, and 23rd, with approximately 300,000, 610,000, and 420,000 shares sold respectively. In total, approximately 1.7 million shares were sold in four separate transactions, realizing about $352 million, with an average price of approximately $210 per share based on the closing price . The cost basis of these shares was close to the offering price of $31, making the profit margin quite substantial.

Why did she choose this location to sell? There are two reasons.

The first layer is discipline. ARK has a mechanical rule: if the weight of a single stock in a fund approaches or exceeds 10%, a rebalancing is triggered. Circle rose too sharply, and its weight was passively pushed up, so the rule itself forced it to reduce its weight.

The other layer is supply. As mentioned earlier, the 85% that was locked up would eventually be released. In fact, Circle had an early release clause: it would be triggered if the stock price was 15% higher than the offering price for five consecutive trading days. JPMorgan Chase released 11.5 million shares on August 13; on August 15, Circle issued another 10 million shares at $130, of which 8 million shares came from existing shareholders selling their holdings.

While policies pushed prices sky-high, the floodgates of supply were being opened one by one. Smart money understood this perfectly. Sister Wood didn't sell at the absolute peak. Her first two sales were around $150, and her last was only at $263, while the stock had reached a high of $299 during the day. Looking at any single sale, she didn't sell at the absolute top. But she wasn't betting on the absolute peak; she was realizing her profits in stages at different points in the upward trend—a repeatable strategy—and her subsequent buybacks followed a similar reflective logic.

3. Buy back during a sharp drop

After peaking on June 23, Circle began a decline that lasted for several months.

The downward forces are cumulative:

The valuation corresponding to a market capitalization of $66 billion has long deviated from the fundamentals;
The supplies that were released from restrictions are gradually becoming available;
Furthermore, the market has begun to bet on the Federal Reserve to cut interest rates, and Circle's revenue is highly dependent on interest income from reserves, so a rate cut would directly impact its profit expectations.

A rise is all good news, a fall is all bad news.

On November 12th, Circle released its third-quarter financial report, showing a net profit of $214 million, three times that of the same period last year, and earnings per share of $0.64, far exceeding market expectations of $0.20—impressive figures. However, the stock actually fell 12% that day, closing at $86.30. There are three reasons for this:

The main lock-up period expires in two days (November 14th), and another batch of insiders can sell.
The company has raised its expense guidance;
And concerns about the impact of interest rate cuts on interest income.

The good financial report has become a case of "all the good news being priced in" .

On that very day, Sister Wood made another move. On November 12, she bought approximately 350,000 shares, worth about $30.4 million; she bought more the next day, totaling about 540,000 shares and about $46 million over the two days, with an average purchase price between $82 and $86—this was her first time buying back Circle shares since reducing her holdings in June.

She continued buying as the price fell. In March 2026, Circle rebounded to around $100 during another major drop, and she bought approximately $16.3 million more. Circle fell to a low of $49.90, a pullback of 83% from its peak.

By the end of the first quarter of 2026, according to 13F filings, ARKK's holdings in Circle had returned to approximately 4.5 million shares, roughly the same as on the first day of trading —she bought back the shares she sold at just over $200 at a price between $80 and $130. CRCL is now ARKK's sixth-largest holding, with ARKK's fund alone holding approximately $300 million.

Her buying process wasn't perfect either. The earliest purchases were at around $80, but the stock later dropped to $50—these early orders were subsequently trapped. But she continued to average down, relying on the same unwavering judgment: Circle's business model had long-term potential .

III. What can we truly learn?

After reviewing the performance, besides the advantage of " low cost ," there are three key aspects that stand out:

First, she had an independent judgment about Circle's ultimate fate . This judgment came before the transactions. She dared to take a large position at a cost close to the offering price and dared to buy back when the price dropped to around $80 because she believed that stablecoins were the underlying infrastructure of the digital dollar, and USDC was a core component of it. Without this judgment, the so-called high-level purchases and deep-drop buybacks would just be "chasing the highs and selling the lows" in a different way.

Second, segment the market, avoid betting on specific price points . Sell in segments as prices rise, and buy in segments as prices fall. In June, she sold in four separate transactions, averaging around $210; during the decline, she bought in multiple separate transactions, from around $80 all the way down to around $50, and then added more at $100 and $130 after the rebound. Individually, none of these transactions might be optimal, but together they form a clean "sell high, buy low" pattern. This approach doesn't require predicting tops and bottoms; it only requires disciplined execution when extreme prices occur.

Third, there is a limit to the position size. What forced her to reduce her position in June was largely the mechanical rule of "rebalancing when the weight of a single stock exceeds 10%". This rule locked in her profits when Circle surged to 299, and also gave her cash and room to buy back in after the price fell back.

Position management discipline is what ordinary retail investors lack most.

For most people, "rushing to buy at the opening" is precisely the most dangerous move. That initial jump at the opening is a bonus prepared for those who received pre-IPO allocations; when ordinary people can buy in on the secondary market, the easiest thing to catch is the highest point pushed up by the supply-demand imbalance. Circle fell from $299 to $50, a pullback of 83%, and those who bought in above $200 are likely still deeply trapped today. Similarly, when participating in Circle, Sister Mu made a brilliant move, relying on her judgment of the final outcome, the cost basis of the offering price, independent judgment, and position discipline . Lacking any one of these could have led to a completely different result.

Ant International denies access to Circle

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