TLDR Tech / Crypto
Wall Street turns cautious on Circle
Mizuho downgraded Circle to Underperform and cut its price target 41% to $50, while JPMorgan lowered earnings estimates for both Circle and Coinbase, citing pressure on USDC economics from the new Open USD stablecoin consortium (140+ members including Visa, Mastercard, Stripe, BlackRock, and Coinbase) that routes nearly all reserve yield to distributors versus Circle's roughly 38% retention model. JPMorgan pointed to Circle's revised Hyperliquid deal, where Coinbase now takes all reserve income before returning about 90% to the DEX, as a "prisoner's dilemma" pushing Circle and Coinbase to compete on revenue-sharing terms. Bernstein and William Blair remain bullish, keeping Outperform ratings and arguing Circle's liquidity and regulatory lead are hard to replicate.
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