JPMorgan Analysts Flip Bullish on Circle, Citing Faster Stablecoin Growth

In brief

JPMorgan analysts upgraded Circle’s rating to “Overweight.”
They lifted their price target to $100 from $94 for Circle shares.
It’s still unclear whether the stablecoin will be dominated by incumbents, they said.

JPMorgan analysts assigned an “Overweight” rating to Circle shares on Thursday, saying fundamental aspects of the stablecoin issuer’s business are improving.

The bank’s analysts said Circle’s third-quarter results were better than expected, prompting them to lift their 2026 year-end price target to $100 from $94 per share. When JPMorgan analysts initiated coverage of Circle in June, they iterated an $80 price target.

Although Circle is expected to face more competition from Wall Street firms bringing alternatives to USDC to market, JPMorgan analysts said a “pipeline of potentially large partnerships” tied to Circle’s layer-1 blockchain will likely buoy its flagship stablecoin’s growth.

Circle’s Arc network, which is optimized for stablecoins, is in testnet phase, but German multinational Deutsche Borse and London-based financial software company Finistra are among behemoths that have signaled an interest in the product, JPMorgan analysts noted.

“As the network strengthens, the pace of USDC adoption should grow and the outlook for higher margins increases,” they said, while highlighting Visa’s interest in Arc as well.

Circle is considering a token for Arc, which would create another avenue for Circle to monetize its infrastructure, JPMorgan analysts said. They compared it to Coinbase’s interest in potentially creating a token for its Ethereum layer-2 scaling network Base.

Circle earns more money from USDC’s reserves when the stablecoin is held on its platform, and at the end of the third quarter, that figure had reached $9.1 billion, JPMorgan analysts said. At the end of last year, Circle only had $1.1 billion in USDC on its platform, they noted.

In recent weeks, Circle’s stock price has underperformed as lockups for common shares expire, JPMorgan analysts said. In total, around 160 million shares have recently become tradable, lifting Circle’s share float substantially from 50 million.

On Thursday, Circle shares changed hands around $86, according to Yahoo Finance. Over the past month, the company’s stock price has tumbled 37%, as the S&P 500 has advanced.

USDC has ceded market share to Tether’s USDT this year, but JPMorgan analysts described Circle’s dominance as “stable.” They posited that USDC has a competitive advantage over USDT as “regulatory compliance becomes more essential.”

Circle is increasing its presence as a stablecoin partner for traditional firms, but JPMorgan analysts caveated their upgrade with a question: “Are stablecoins a winner take most market?”

“The quicker Circle can build its network, the more confidence we will have in the winner-take-most outlook,” they said. “However, with new stablecoin entrants proliferating and innovation emerging, we […]. are keeping an open mind.”