Bernstein Just Cut Circle’s (CRCL) Price Target by $50 — but Still Says Buy — Here Is Why
Bernstein lowered its price target on one of the industry’s largest stablecoin issuers, Circle (CRCL), from $190 to $140 on Tuesday while keeping an Outperform rating on the stock — a combination that reflects a more cautious near-term outlook on USDC supply growth without abandoning the longer-term bull case for the stablecoin issuer.
Circle Faces Lower USDC Supply Estimates
The core reason for the target cut is a significant downward revision to USDC supply projections. Bernstein analyst Gautam Chhugani reduced the firm’s estimate for USDC’s circulating supply by 2028 to approximately $170 billion, down from a prior forecast of $290 billion.
USDC supply closed the second quarter of the year at approximately $73 billion, down from $77 billion in the first quarter. However, average supply edged slightly higher quarter-over-quarter, from $75 billion to $76 billion.
Chhugani noted that USDC held up relatively well during the current market drawdown compared to its behavior back in 2023, when supply fell more than 50%.
The firm maintained its 10-year USDC growth model at a 32% compound annual growth rate but adjusted near-term 2027 and 2028 estimates to account for crypto market cyclicality.
The resulting drag on reserve income — the money Circle earns from the assets backing USDC — was partially offset by higher reserve yields. Bernstein’s reserve income estimates for 2026, 2027, and 2028 declined by approximately 17%, 18%, and 13%, respectively.
The Open USD Threat Is Overblown
On the competitive threat from the Open USD (OUSD) consortium — a group that includes Visa, Mastercard, and Stripe and has been cited as a significant risk to USDC’s market position — Chhugani argued the market is overreacting.
The analyst noted that Circle has been signing memorandums of understanding with several of the same entities listed in the alliance, suggesting the competitive dynamic is more nuanced than the market has priced in.
Visa executives separately said the company intends to remain multi-coin and multi-chain despite the consortium’s formation — a signal that Open USD’s arrival does not automatically come at USDC’s expense.
Circle’s next earnings report is scheduled for August 5, 2026. Wall Street price targets on the stock currently range from $50 to $243 — a spread that reflects the genuine uncertainty around how USDC supply grows from here and how much competitive pressure materializes from Open USD and other stablecoin challengers.
In other recent developments, the stablecoin issuer acquired IBM’s blockchain patent portfolio — a collection of more than 680 patent families and nearly 1,000 issued patents globally covering blockchain technology, financial services, supply chain verification, and cloud operations.
Circle’s stock, CRCL, currently trades at $62.60 at the time of writing, down nearly 80% from its all-time high of $298, reached more than a year ago in June 2025.
Featured image generated with OpenArt.