On June 30, 2025, JPMorgan initiated coverage of Circle (CRCL), the issuer of USDC, with an underweight rating and an $80 price target, implying a 56% drop from its July 2 closing price of $177.97, as shown in the finance card above. This forecast, led by analyst Kenneth Worthington, follows Circle’s 487% surge since its June 5 IPO at $31, though it’s down 39% from its June 23 peak of $299. With a $44.2 billion market cap and a P/E ratio of 234, JPMorgan argues Circle’s valuation is unsustainable due to intensifying competition and regulatory risks.
JPMorgan highlights the growing challenge from new stablecoin issuers, tokenized deposit accounts, and digital money market funds, noting low switching costs could erode Circle’s USDC market share. Retail behemoths like Amazon, Walmart, and Mastercard are investigating the introduction of stablecoins, and pressure is increased by JPMorgan’s own JPMD token, a deposit token on Coinbase’s Base blockchain. Analysts warn that competitors could leverage Circle’s network if they gain critical mass, threatening its dominance as the second-largest stablecoin behind Tether’s USDT.
JPMorgan also points to potential U.S. stablecoin regulations, similar to Europe’s MiCA, requiring issuers to hold equity capital proportional to circulation, which could limit USDC’s growth. Global adoption of central bank digital currencies (CBDCs), particularly in Europe, poses another threat to Circle’s international expansion. Despite Circle’s regulatory compliance, including its 2015 New York BitLicense, stricter rules could raise costs and restrict use cases.
Barclays counters with a bullish $215 price target, citing USDC’s growing adoption in traditional finance. Bernstein ($230) and Canaccord Genuity ($247) also see Circle as a long-term winner in a stablecoin market projected to hit $4 trillion by 2035. Circle’s trust bank charter application, aiming to self-custody USDC reserves, aligns with regulatory shifts like the GENIUS Act. However, JPMorgan’s caution reflects Circle’s reliance on reserve-based income and competitive pressures, with CRCL dropping 15.5% on June 27 amid market uncertainty.
