Company: CRCL
Filing Date: 2025-04-01
Form Type: S-1
Source: 0001193125-25-070481
Chunk: 346

Company: Circle Internet Group, Inc.
Filing Date: 2025-04-01
Form: S-1
Chunk 346
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 period and records the change in fair value in the Consolidated Statements of Operations. The changes in carrying value of warrant liability are reflected in the following tables (in thousands):

| Table 11.2. Changes in Carrying Value of Warrant Liability |     |   |       |   |
|:-----------------------------------------------------------|:----|:--|------:|:--|
| Balance as of December 31, 2023                            |     | $ | 1,642 |   |
| Fair value adjustment                                      |     |   |   (51 | ) |
| Balance as of December 31, 2024                            |     | $ | 1,591 |   |

| Balance as of December 31, 2022 |     | $ |  2,689 |   |
| Fair value adjustment           |     |   | (1,047 | ) |
| Balance as of December 31, 2023 |     | $ |  1,642 |   |

Obligation to return digital asset collateral — embedded derivatives Embedded in the debt host obligation to return digital asset collateral related to Circle stablecoin borrowing and lending activities is a feature indexed to digital asset that is not clearly and closely related to a debt instrument, which meets the definition of a derivative and requires bifurcation. The feature is fair valued using the “with” and “without” approach. During the period when an obligation to return the digital asset collateral exists, the embedded derivative is marked-to-marketand any changes in the fair value of the underlying digital asset is recorded within Digital assets (gains) losses and impairmenton the Consolidated Statements of Operations. Upon the return of the digital asset collateral, any unrealized gain (loss) on the embedded derivative that was attributable to the collateral is realized. As of December 31, 2023, the embedded derivatives balance only consisted of embedded derivatives in connection with the digital asset collateral related to Circle stablecoin lending activities and does not contain any significant unobservable inputs. There were no digital assets held as collateral related to Circle stablecoin lending activities as of December 31, 2024. F-35

Convertible debt, net of debt discount On March 1, 2019, the Company issued a convertible note in connection with an acquisition. The note had a par value of $24.0 million, matures in seven years and is convertible into Series E preferred shares with a 2.9% interest rate. The Company elected the fair value option for recording this note