Morgan Stanley Slashes Circle's Price Target by 60%

Circle Internet's stock (CRCL) has fallen over 5% in pre-market trade after Morgan Stanley downgraded it to 'Underweight' from 'Equal Weight' and slashed its price target by 60%, to $38 from $106.

This move has added to the pressure on CRCL stock, which has already fallen over 20% this year and more than 65% in the last 12 months.

The decline in CRCL stock is part of a broader selloff in crypto equities, with Bitcoin's (BTC) price falling 0.8% in the last 24 hours to below $63,000.

Morgan Stanley analyst James Faucette believes that Circle's USDC revenue model faces pressure due to the contraction in USDC circulation, which may not grow as quickly as expected.

However, TD Cowen remains bullish on CRCL, initiating coverage with a 'Buy' rating and a $82 price target, implying a potential upside of over 30% from CRCL's Friday closing.