By Nate Wolf
Circle Internet Group has been one of the few winners in the crypto industry in recent months but the stablecoin stock still has room to run, according to analysts at Clear Street.
The firm upgraded Circle shares to Buy from Hold and lifted its price target to $136 from $92 in a research note Monday. Adoption of the company's dollar-pegged USDC coin has surged since the start of February, suggesting more financial institutions and consumers are embracing stablecoins, Clear Street argued.
Circle stock jumped 7.5% to $$123.98 on Monday, putting it on pace for its highest close since last October, according to Dow Jones Market Data. Shares have climbed 46% this year as of Friday's close of trading.
Circle makes the vast majority of its revenue from interest on USDC reserves, so the growth of USDC is crucial to the company's success. After rising to more than $78 billion in December, USDC's circulation fell to around $70 billion by the end of January. It has since recovered to an all-time high of $79 billion, according to data from CoinGecko.
The Iran war, which has disrupted banking and exchanges in the Middle East, may be part of that surge. With many people using USDC for remittances and cross-border transactions, the currency has demonstrated one of its core use cases, Clear Street said.
"Through this uncertain period, USDC market capitalization continued to trend higher, even as broader equity and crypto markets declined, suggesting demand was driven by transactional utility rather than speculative positioning," wrote Clear Street analyst Owen Lau.
Other use cases are proliferating, too. Financial institutions are increasingly tokenizing funds, which refers to digitizing these funds to trade on blockchain ledgers. While USDC isn't the only settlement currency for these platforms, its regulatory compliance and broad compatibility make it a solid choice.
The same goes for prediction markets, where Polymarket's expected expansion into the U.S. could boost demand. Many prediction markets settle trades in USDC, supporting greater circulation. Polymarket alone facilitated $22 billion in prediction market trades last year.
Agentic artificial-intelligence is the other trend Circle investors are betting on. AI agents may eventually execute tasks like booking travel, signing contracts, and buying iced lattes without human input. These transactions require digital wallets with 24/7 settlement, and that is where Circle comes in. The company is building its Arc blockchain protocol to serve as infrastructure for agentic payments.
Put all of those uses together and you get a company that isn't reliant on the price of Bitcoin or other cryptocurrencies.
"A central misperception among investors is conflating the fortunes of speculative crypto assets with the adoption trajectory of payment stablecoins," Lau wrote. "These are structurally distinct."
Regulatory clarity would enable even greater institutional flows into digital assets. The banking sector and the crypto industry are sparring over whether the Digital Asset Market Clarity Act should allow stablecoin holders to earn yield on their deposits. With President Donald Trump urging the various stakeholders to reach a compromise, Clear Street believes the Clarity Act will likely pass by the end of the summer.
"Our conversations with institutional allocators consistently highlight regulatory uncertainty as the primary barrier to increasing crypto exposure," Lau said.
Write to Nate Wolf at nate.wolf@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
March 16, 2026 10:21 ET (14:21 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments