Circle Drops 75% as Analyst Sees 18% More Downside

Mizuho Securities USA analyst Dan Dolev has warned that Circle Internet Group , the public company behind the USDC stablecoin, could face further pressure as competition across the stablecoin market continues to increase. Circle's shares have already fallen by more than 75% from the highs reached shortly after its June 2025 initial public offering, and Dolev downgraded the stock from neutral to underperform. He also introduced a Street-low price target of $50, suggesting approximately 18% downside from Thursday's closing level and placing his estimate well below the $123 average analyst target tracked by Bloomberg. Circle shares declined 7.7% on Thursday after Visa , a global payments network, launched a platform that allows financial institutions to issue, transfer and manage stablecoins.Dolev identified Open Standard as a major emerging risk for Circle because the venture is supported by more than 100 financial-technology companies, payment networks, cryptocurrency firms and banks. The group plans to issue the Open USD stablecoin, while its backers include Stripe, a financial-technology company; Coinbase Global , a cryptocurrency platform; and BlackRock , an asset manager. Dolev believes these partners have substantial assets and broad customer networks that could help expand OUSD and challenge Circle's position, even though USDC remains one of the world's largest stablecoins by market capitalization and ranks behind only USDT from Tether Holdings, a stablecoin issuer. Circle's stock had previously surged 750% in the weeks following its IPO as investor enthusiasm around the GENIUS Act increased interest in one of the few publicly traded stablecoin companies, but the shares have since pulled back as new dollar-linked coins entered the market and cryptocurrency assets came under pressure.Circle generates revenue from the yield earned on reserves supporting USDC, but competing stablecoins such as OUSD plan to share reserve income with partners while charging a small management fee. Dolev suggests this model could provide partners with stronger economics and may increase pressure on Circle's pricing, distribution relationships and profitability, despite the company's effort to secure approval as a limited-purpose bank. He expects Circle's adjusted EBITDA to reach $699 million in 2027, compared with a consensus estimate of $907 million, reflecting his concerns about growing competition and partner demands. Dolev also highlighted Circle's USDC distribution agreement with Coinbase as a near-term risk because the deal is scheduled for renegotiation in August, and Coinbase could potentially use the arrival of OUSD to seek a larger share of the economics.