Bernstein Dismisses Investor Concerns Over Circle, Sees Bright Future for USDC
Research firm Bernstein is pushing back against investor concerns over Circle Internet Group (NYSE: CRCL), the stablecoin issuer behind USDC. In a recent note to clients, analysts led by Gautam Chhugani reiterated their Outperform rating and $140 price target on Circle.
The analysts argue that investors are fixating on the wrong risks, specifically rising competition among stablecoins and whether Circle can continue earning income from its reserves as interest rates shift. However, they point out that most of Circle's revenue (about 95% last quarter) comes from reserve income, the interest earned on assets backing USDC.
Bernstein sees several factors contributing to Circle's growth prospects, including its national trust bank approval, expanding Circle Payments Network, and upcoming launch of Arc public mainnet on September 16. Arc is set to debut with founding validators including BlackRock, Visa, Mastercard, and ICE. The firm also notes that management raised its 2026 guidance partly due to $180 million in expected Arc token presale revenue.