Company: CRCL
Filing Date: 2025-08-12
Form Type: S-1
Source: 0001193125-25-178989
Chunk: 174

Company: Circle Internet Group, Inc.
Filing Date: 2025-08-12
Form: S-1
Chunk 174
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 measurement provisions of Accounting Standards Codification Topic 718, Stock-Based Compensation. In the absence of a public trading market, our management and board of directors considered various objectives and subjective factors to determine the fair value of Circle’s common stock as of each grant date, including the value determined by a third-party valuation firm. These factors included, among other things, the following:

| • |     | our actual operating and financial performance and estimated trends and prospects for our future performance; |

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| • |     | the composition of, and changes to, our management team and board of directors; |

| • |     | consideration of the lack of liquidity of the common stock as a private company; |

| • |     | our stage of development, business strategy, and the material risks related to our business and industry; |

| • |     | the valuations of publicly traded companies in the financial services sector, as well as recently completed mergers and acquisitions of peer companies; |

| • |     | external market conditions affecting the financial services sector; |

| • |     | the likelihood of achieving a liquidity event for the holders of our common stock; |

| • |     | the prices, rights, preferences, and privileges of our convertible preferred stock relative to those of our common stock; and |

| • |     | the prices of our convertible preferred stock and common stock sold to investors in arm’s-length transactions or offered to investors through a tender offer. |

**Our policy is to value our common shares at least quarterly with significant events potentially requiring additional valuations. In September 2021, we initiated a program to grant employees restricted stock units (“RSUs”) as part of our compensation program. The RSUs vest upon the satisfaction of both a service condition and a liquidity condition. Both the service and liquidity conditions must be met for the expense to be recognized. The fair value of RSUs is estimated based on the fair value of our common stock on the date of grant. Stock-based compensation expense related to the RSUs is recorded on a tranche-by-tranche basis over the requisite service period, when the liquidity condition is considered probable. We use the Black-Scholes option pricing model (“Black-Scholes”) to estimate the grant-date fair value of option grants. The Black-Scholes model requires management to make a number of key assumptions, including expected volatility, expected term, risk-free interest rate, and expected dividends. The expected term represents the period of time that the options are expected to be outstanding and is estimated using