Stablecoin Firm First Digital Plans SPAC Market Listing

The Hong Kong-based company is aiming to list via a special purpose acquisition company (SPAC) merger with CSLM Digital Asset Acquisition Corp III, Bloomberg News reported Monday (Dec. 1), citing sources familiar with the matter.

According to the report, First Digital issued FDUSD, a stablecoin with a market circulation of about $920 million, which is down from a peak of roughly $4.4 billion in April of last year.

As Bloomberg noted, the pace of crypto listings has sped up this year as companies look to make the most of the Trump administration’s pro-digital assets position. Among the companies to list this year include stablecoin issuer Circle.

That company’s market debut, PYMNTS wrote this summer, marked a wider cultural and economic shift.

“For years, cryptocurrencies have lived at the margins of institutional finance, oscillating between hype cycles and regulatory crackdowns,” that report said.

“With Circle’s entry into the public market, a new chapter looks set to begin. With blue-chip banks underwriting the deal and retail investors clamoring for shares, the traditional finance world appears more open than ever to embracing digital assets.”

SPACs have also been enjoying a comeback this year. The so-called “blank check company” wave saw around 600 U.S. companies raise a record $163 billion in 2021, though the trend faded when global stocks plunged in 2022 as interest rates rose.

In other stablecoin news, PYMNTS wrote last week about how this segment of the cryptocurrency sector was being impacted by the downturn in the overall crypto market.

While bitcoin, the most popular cryptocurrency, had reached a record high of $126,000 in October, it has since fallen to under $86,000, with large-scale liquidations hitting the market.

“The problem for the rest of blockchain finance? The crypto ecosystem is highly interconnected, and certain stablecoins use bitcoin (and bitcoin ETFs) as part of their reserve mix of backing mechanisms,” PYMNTS wrote.

“Stablecoin pegs can fluctuate during depegging events, when the token value moves away from the value it is supposed to match due to fluctuations in its reserve composition or other extenuating factors.”

Touted as a more reliable on-chain asset alternative to traditional cryptocurrencies, stablecoins still remain integrated with, and not wholly protected from, the larger digital asset marketplace, that report added.