A notice of acquisition from Circle has led to a fierce collision between decentralized dreams and real-world interests. A company's decision to ‘want the team but not the tokens’ is prompting deep reflection on the nature of tokens in the crypto world.

The stablecoin giant Circle announced yesterday that it has completed the acquisition of core talent and technology from the initial development team of the cross-chain protocol Axelar Network, Interop Labs. However, this seemingly routine transaction has caused a market stir due to a key detail: the acquisition explicitly does not include the Axelar project itself, the foundation, or the AXL token.

The market reacted swiftly and decisively. After the news was released, the AXL token plummeted about 15% in a short time, with a price of $0.115, resulting in millions of dollars in market value evaporating. This acquisition unexpectedly sparked a deep debate in the crypto industry regarding token value, team responsibility, and investor rights.

01 Acquisition Logic and Market Reaction

Circle's acquisition this time is highly selective. According to the announcement, Circle will incorporate the Interop Labs team and its proprietary technology to promote the multi-chain infrastructure construction of its Arc blockchain and cross-chain transmission protocol.

The Axelar network will continue to be governed by the community, with another contributing team from the original project, Common Prefix, taking over related work. The transaction is expected to be completed in early 2026, with specific terms undisclosed.

Circle, as the issuer of the world's second-largest USD-pegged stablecoin USDC, with a market capitalization of about $60.9 billion, this acquisition aligns with its strategic layout to strengthen multi-chain infrastructure. However, market attention is focused on the AXL token that has been excluded from the transaction.

This 'pick and choose' acquisition method immediately triggered panic among token holders. Investors are concerned that the departure of the core development team may affect the technical maintenance and future iterations of the Axelar network, especially the long-term support for cross-chain bridges, nodes, and SDK.

02 The Dilemma of Token Holders

The sharp decline in the AXL token is not simply an overreaction from the market but reflects the deep-seated concerns of holders about the token's value being 'hollowed out.'

Interop Labs, as the initial developer of the Axelar network, has always been an important support for token value with its technical capabilities and roadmap execution. When Circle only acquires the team and clearly abandons the tokens, it sends a dangerous signal: tokens are only useful during the financing stage and can be completely ignored during the value realization stage.

This concern resonated strongly in the crypto community. Moonrock Capital founder Simon Dedic bluntly stated: "Another acquisition, another RUG. Circle acquires Axelar but explicitly excludes the foundation and the AXL token; even if it's not illegal, it violates basic ethics."

Chainlink community representative Zach Rynes pointed out: "This exposes the long-standing conflict between tokens and equity in the crypto industry. The development team successfully exits, while the token holders who provided them with funding gain nothing."

03 Circle executives' cash-out history

The historical behavior of Circle executives and shareholders cashing out at high stock prices has intensified market skepticism about the fairness of this acquisition.

In August 2025, after Circle's stock price rose 349% since its IPO, the company announced the sale of 10 million shares, with shareholders including CEO Jeremy Allaire cashing out approximately $1.4 billion.

This stock sale occurred much earlier than expected—only two months after Circle's IPO, far from the end of the year lock-up period. Morgan Stanley, as the main underwriter and lock-up waiver decision-maker, did not prevent this sell-off.

Such behavior raises concerns among investors that Circle may be more focused on maximizing internal personnel benefits rather than being accountable to all token holders or investors. When company executives are accustomed to cashing out at high value points, token holders naturally worry that they will be placed in a secondary position in similar situations.

The core of this controversy lies in the ambiguous positioning of tokens within the current legal and business framework.

Arca Chief Investment Officer Jeff Dorman analyzed from the perspective of capital structure: "In traditional finance, the priority of capital is very clear: secured debt → unsecured senior debt → subordinated debt → preferred stock → common stock → tokens." This means that tokens are inherently at the bottom of the capital structure.

History has shown countless cases that the gains at one level often come at the expense of another level. When a project succeeds, tokens may be implicitly considered 'quasi-equity,' endowed with a claim to future success; but in real scenarios such as mergers, bankruptcies, and liquidations, tokens are quickly reverted to their original form of 'no rights certificates.'

Electric Capital co-founder Avichal Garg's viewpoint is more straightforward: "If all future value is created by the team, no company would be willing to pay for token investors." This viewpoint reveals the harsh reality of business.

05 Industry Impact and Future Insights

The case of Circle and Axelar is not an isolated incident but rather a governance challenge that the crypto industry inevitably faces during its maturation process.

Such acquisition behavior is sending an industry signal: large companies are expanding their infrastructure capabilities by acquiring talent rather than relying on token endorsements, leading to an escalation in the talent competition in Web3. More such 'talent acquisitions + ecosystem restructuring' chain reactions may emerge in the future.

This has also raised questions about the effectiveness of decentralized governance. Theoretically, a DAO can replace the development team through voting rights, but the reality is much more complex. Even for projects with a certain market share, when internal issues arise, changing teams may cause the project to lose market competitiveness.

For projects relying on Axelar infrastructure, there is an immediate need to assess risks, and whether the Common Prefix team can effectively take over the development work will determine whether the Axelar ecosystem can continue to develop.

Summary:

This acquisition exposes the core contradiction of the crypto world: the conflict between the ideal of decentralization and the centralized business reality. As one industry observer pointed out: "Tokens do not inherently possess rights; only institutionalized and structured rights will be recognized at critical moments."

For AXL holders, short-term price fluctuations may just be surface issues; in the long run, whether the Axelar community and the Common Prefix team can quickly fill the gap will determine whether the project can emerge from its predicament. The entire crypto industry faces the eternal question of how to balance team interests and token holders' rights.