Written by: Ruby

Circle fell from $130 to $90, a decline of 30%, and then rebounded. Should you build a position? My judgment: No rush. At $90 for Circle, you are paying the price of a "fintech platform" for an "interest rate bank."

I reviewed the 10-K annual report, analyzed Q1 on-chain data, checked Polymarket interest rate expectations, read the latest draft of the CLARITY Act, and examined all insider stock sale records to share my judgment.

This article is only to update my judgment on $CRCL and does not constitute investment advice.

Conclusion First

$90 is not a good entry price; my judgment is to hold. Want to increase your position? A better entry range is $80 or lower.

Why? 96% of revenue relies on the interest rate banking model, but the market is pricing it as a fintech platform—forward P/E of over 40 times, which is already high.

In the next six months, there are three catalysts that will determine the direction: Senate committee vote on the CLARITY Act (critical window in late April), Q1 financial report (expected mid-May to early June), Coinbase agreement renewal + Q2 financial report (August). Additionally, if BTC falls below $60K, the related crypto stocks could also decline, serving as a potential downward catalyst. Any negative result could send the stock price into the target range.

I remain optimistic about the long-term direction of stablecoin payments, but the current price does not provide enough margin of safety to add to my position.

1. Valuation: What are you buying at a $90 stock price?

You are paying the price of a "fintech platform" for an "interest rate bank" that has not completed its transition.

1.1 Circle's P/S Needs to be Adjusted to P/RLDC

The $90 stock price corresponds to a valuation of $22 billion. Based on FY25 total revenue of $2.75 billion, it seems the P/S ratio is 8, and many would call this undervalued.

However, do not forget that $1.66 billion is distribution costs—mostly payments to Coinbase. After these expenses, the actual revenue that stays in Circle's pocket (RLDC, Revenue Less Distribution Costs) is only $1.08 billion.

Thus, Circle's valuation cannot just rely on the surface P/S; it must use P/RLDC—20x. This is higher than Visa and Mastercard's current P/S (around 11-12x) and close to Adyen's historical valuation upper limit (~20x). Payment networks have net profit margins ranging from 45-65%.

Currently, 96% of Circle's business model is based on banking interest spread, and only 4% comes from other revenues close to a fintech platform. The market offers a dual pricing of "bank valuation + platform dream." Let's break down the $90 into two layers:

The wide range for the platform option layer is due to the current unverified income from CPN, Arc, and AI Agent—uncertainty itself is part of the pricing.

1.2 The Outlook for Stablecoins in 2028

You might say we need to look to the future. Indeed, I absolutely support the long-term potential of stablecoin payments and the market cap, and it is one of the few applications in the cryptocurrency space that continue to grow unaffected by cycles. So let’s calculate this potential together and see which side you might stand on.

Below is the guidance provided by management for fiscal year 2026.

Management guidance for CRCL FY25 Q4 financial report

Based on this year, the estimated guidance is achievable. Assumptions: total issuance of stablecoins grows at a 40% annual growth rate, this year the USDC circulation will be 90-100B, average interest rate of 3.3%, and other revenues reaching management guidance of $150-170 million, with an RLDC margin of 40%.

Under these assumptions, the forward P/E at $90 is in the 40s. Compared to peer fintech companies, it is already in the high range.

Of course, if you are willing to pay for the narrative of Agentic payment, Arc public chain, and CPN network, you could believe Circle is worth $110-120+. Just based on current revenue analysis, the market has already price in the narrative of Circle’s platform.

Note: Personal estimates and analyses are for reference only.

2. Key Focus of Circle’s 2026 Financial Report

The advantage of crypto stocks is that on-chain data can be observed ahead of financial reports. How did stablecoins and USDC perform over the past quarter?

2.1 Observation of Stablecoin Scale in Q1 2026

The good news is that from Q4 2025 to Q1 2026, despite the crypto bear market, the issuance scale of stablecoins is still growing. However, the quarterly growth rate has slowed down, marking the slowest quarter since Q4 2023. In other words, the logic of increasing revenue through USDC volume growth is running out of steam in the short term.

The diagram below shows the quarterly growth rates of stablecoin supply from 2024 to 2026. Pay particular attention to the rightmost bar.

The key point is: emerging stablecoins (USD1, USDS, etc.) now account for about 15% of the market share, and the total pie of the dual oligopoly is being eroded. Circle has not lost its share, but it has not claimed any new increments either.

Comparison of stablecoin issuers’ market shares from Q4 2025 to Q1 2026 (data aggregated from multiple sources, slight differences due to varying criteria).

2.2 Q1 Financial Report Prediction: Any Big Surprises?

It is highly probable that the results will meet expectations, without great surprises. Since there was no interest rate cut in Q1, revenues from reserves plus other income of $30-40 million would be enough to meet standards. If there is a turning point, it would still depend on whether the other income line exceeds expectations.

To meet the management’s goal of a 40% CAGR for the year, real growth pressure for USDC lies in Q2-Q4, needing to reach approximately $105 billion in issuance by year-end.

2.3 Policy Aspect: CLARITY Act and Absence of Drivers

The biggest recent focus has been on the yield ban clause in the CLARITY Act.

Circle does not pay yield itself, so its business model is not directly impacted. However, the indirect ramifications are real—the transmission chain is as follows:

Yield ban takes effect → Coinbase cannot offer passive rewards from USDC (activity-based rewards are still allowed) → Individual holders have less reason to hold USDC → Circulating growth slows → Core revenue engine of Circle decelerates.

Another risk that is easily overlooked: the most critical legislative driver for crypto at the White House is no longer there. David Sacks left on March 26 due to the expiration of his 130-day special government employee term and assumed the position of co-chair of PCAST without a successor. This means that if the bill does not pass before May, digital asset legislation will be very difficult to push forward in the foreseeable future—the most critical legislative window has lost its strongest internal driver.

Below, I have organized key events and time points to watch this year:

3. Who is Trading CRCL? Is it a Retail Stock?

$CRCL is one of the most mentioned crypto stocks on social media, exhibiting high volatility with a somewhat meme stock quality.

3.1 Why is there a Major Divergence in $CRCL?

I specifically checked the latest data; Circle’s ownership structure is roughly as follows:

Data Source: Tipranks

Listed in 2025, institutional ownership is below 40%; the allocation ratio is not as high as mature tech stocks, suggesting it is primarily dominated by retail investors and insiders.

Retail stocks have high Beta and are more narrative-driven. Volatility is the norm, and overvalued and undervalued scenarios are also common. Consequently, estimates by institutions range from $60 to $280, with a disparity of 4-5 times.

From the perspective of ownership structure and retail proportion, similar cases in the U.S. stock market include Coinbase in its early listing days, and currently Palantir and Robinhood—all are retail-dominated, narrative-driven, and highly volatile stocks.

The good news is: as institutional ownership increases, there is room for a "institutional premium" in the long run.

3.2 Executives Continuously Selling: Price Worth Noting

Since the last financial report was released, I have tracked all SEC filings, reviewing all insider stock sale reports.

From February 26 to April 2, insiders executed about 23 public market sales, totaling approximately 649,000 shares, worth about $62.2 million.

During the same period, purchases: 0.

Of course, selling after an IPO lock-up period is normal. However, the ratio of 23:0 and the selling price range ($82 to $123) are still worth noting.

Selling intensity ranking:

Heath Tarbert (President) was the most aggressive—4 sales totaling ~191,000 shares, cashing out ~$19.35 million, cumulative reduction of about 26%.

M. Michele Burns (Director)—4 sales totaling ~162,000 shares, cashing out ~$15.93 million, cumulative reduction of about 27%.

Patrick Sean Neville (Director)—sold 50% of his Class A holdings on April 1; only 30,000 Class A shares remain, but he still holds about 2.36 million Class B and a significant number of options. Jeremy Allaire (CEO) has a very small reduction percentage overall. On February 26, he sold 15,625 shares (approximately $1.4 million), but the overall reduction percentage is very small. He currently directly holds about 560,000 Class A shares and 16.2 million Class B shares, with an economic share of about 6.8%. Since Class B shares have 5 votes per share (total voting rights capped at 30%, shared with co-founder Neville), Allaire effectively controls about 26% of the total voting power. Data Source: SEC, Markets Daily, Ticker report.

4. Circle's Real Competition Comes from New Narratives

The issuance of stablecoins is a crowded market; stablecoin payments are the new frontier.

The landscape for compliant stablecoin issuance is basically stable, and profits can be calculated. Circle's story is no longer about issuance volume—it's about other revenues, CPN payment networks, wallets, and the Arc public chain.

Thus, in my view, Tether is no longer the true benchmark for Circle's management. Even if Tether takes a compliant path into the U.S., the circulation of USDC in the existing compliant platforms is unlikely to change significantly for a while—recently, Circle announced deepened cooperation with Polymarket, which exemplifies this. Tether's strategic focus this year has also shifted towards diversified investments and the gold token XAUT (for those interested, you can refer to my previous tweet on this topic).

The true competition Circle faces comes from Stripe.

The strategic direction of CPN payment networks + wallets + Arc public chain highly overlaps with Stripe's $160 billion valuation. After setting its AI + stablecoin strategy in 2025, Stripe's execution has been strong—acquisitions of Bridge and Privy, Tempo mainnet launch, and implementation of the MPP protocol. Both companies are fully sprinting towards Agentic payments and have joined the x402 protocol led by Coinbase.

If Stripe goes public, the scarcity of Circle as the "first stablecoin stock" may be discounted.

Tempo is already online, and now the pressure is on Circle. When will the Arc public chain release its mainnet? Additionally, management previously mentioned in a financial report meeting that they were exploring token issuance. The progress of Arc and AI payment implementations will be crucial for judging whether Circle can develop a second curve of revenue.

5. Conclusion

The stablecoin market continues to grow in the crypto bear market, but the growth rate has slowed.

The dual oligopoly structure is firm, but long-tail competitors are eating into market share.

Issuance is a crowded market, while payments remain a new frontier—and in this payment space, neither CPN nor Arc have yet achieved explosive growth.

$CRCL remains a scarce U.S. stock in the stablecoin race, and the high retail proportion also explains why market attention is so significant. Agentic payments are the battleground for future increments; there is room for imagination, but substantial payment scenarios have yet to materialize.

$80-100 belongs to a reasonable but optimistic valuation range. At $90, I will continue to hold, not buy or sell, waiting for catalysts. Lastly, I've organized metrics and influential events to watch for $CRCL this year for everyone’s reference.

The above analysis is based on public information and personal judgment and does not constitute investment advice. The analytical framework used is my self-built Tech Earnings Deep Dive Skill.

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