Key highlights:
- Bernstein maintains a $230 price target for Circle, reflecting confidence in its long-term dominance in the stablecoin market.
- Analysts cite Circle’s liquidity, regulatory advantage, and infrastructure as key differentiators despite rising competition.
- Circle reported a 90% year-over-year increase in USDC circulation and launched a new Layer 1 blockchain, Arc.
Bernstein analysts have reaffirmed their bullish stance on Circle Internet Group (CRCL), reiterating a $230 price target that implies a 40% upside from the current trading level of $163.21.
The investment firm argues that Circle is poised to become the leading stablecoin network, driven by its liquidity, regulatory edge, and payments infrastructure.
“Our Circle long-term thesis is that the most liquid, regulated stablecoin will win as the dominant stablecoin network,” said the Bernstein team, led by analyst Gautam Chhugani, in a note issued following the company’s Q2 earnings report.
Navigating competition and regulatory shifts
Circle, the issuer of USD Coin (USDC), currently controls $65 billion of the approximately $260 billion total U.S. dollar-pegged stablecoin market. Despite increasing competition from firms like JPMorgan, PayPal, and Robinhood, as well as potential regulatory shifts under the Trump administration’s recently signed GENIUS Act, Bernstein sees Circle maintaining a clear lead.
The analysts argue that a compliant U.S. launch of rival stablecoin Tether (USDT) would face scalability challenges and lack the deep partnerships Circle has cultivated across the financial ecosystem. Circle’s growing footprint on exchanges like Binance and Coinbase and its infrastructure initiatives are key to preserving its advantage.
Arc blockchain and Q2 financials
Circle recently introduced Arc, an enterprise-grade, stablecoin-focused Layer 1 blockchain. Scheduled to launch on public testnet this fall, Arc will use USDC as its native gas token and offer features like a stablecoin FX engine, sub-second settlement, and opt-in privacy. Bernstein views Arc as a “demand sink” for USDC, enhancing its utility and revenue-generating potential.
Introducing Arc, the home for stablecoin finance.@Arc is an open Layer-1 blockchain purpose-built to drive the next chapter of financial innovation powered by stablecoins.
Designed to provide an enterprise-grade foundation for payments, FX, and capital markets, Arc delivers… pic.twitter.com/Z8FHUls1xY
— Circle (@circle) August 12, 2025
Circle’s Q2 financials revealed a 90% year-over-year increase in USDC circulation to $61.3 billion, rising further to $65.2 billion by August 10. The share of USDC held directly on Circle’s platform rose from 6% to 10% of total supply, boosting margins due to lower distribution costs. Revenue and reserve income climbed 53% to $658 million, while other revenue segments surged 252% year-over-year.
Despite this growth, the company reported a net loss of $482 million, largely due to non-cash charges tied to its $1.2 billion IPO in June, including $424 million in stock-based compensation.
Analyst divergence
While Bernstein remains optimistic, other firms have expressed more cautious views. Baird recently lowered its price target to $185 with a Neutral rating, while Mizuho cut its target to $84, maintaining an Underperform rating. Tiger Securities cited margin pressure in its decision to revise its price target to $180.
Nevertheless, Bernstein views Q3 as the more critical period for Circle’s performance, highlighting Ethereum price movements and USDC growth as key indicators to watch.
“Circle is going for the big prize of transforming payments and financial services with stablecoins,” said Chhugani, underscoring the firm’s vision of long-term dominance despite near-term market volatility.
Source:: Bernstein Reiterates $230 Price Target for Circle, Citing Stablecoin Dominance