Jason Kam
Founder of Folius Ventures
Circle investors significantly underestimate the risk that leading fintech players team up to launch their own stablecoin. Stripe alone holds an estimated $15-25 billion of float at any time from its transaction volume, equal to 20-25% of USDC's supply, without even actively growing it. x.comÂ
Circle faces pricing pressure because stablecoin infrastructure has low barriers to entry, which is why it stays an underweight with only small exposure. The risk showed when Circle fell 13% as Stripe, Coinbase and BlackRock backed a rival stablecoin, Open USD. x.com x.comÂ
Circle is unlikely to win corporate treasuries, because companies holding mostly T-bills gain nothing by handing those assets to Circle so it can collect their yield. That answers @drGhostinOO7, who argues corporate treasuries are waiting to be tokenized and Circle can take market share from SWIFT. x.comÂ
Circle still benefits from the large stablecoin trend and USDC's utility for businesses and users, so early AI-agent cash recommendations are no reason to turn bearish. Mizuho cut its target to $43 and sees a 10-20% reserve-revenue hit after sampled agents favored insured, higher-yield options over USDC. Few people let agents manage their money, and those who do are not a large share of USDC holders. Agent-only stablecoin payments may be overhyped. x.comÂ
RLUSD is positioned to become a main liquidity layer for XRP trading, as Tether did for Bitcoin. Planned Coinbase access and institutional backing add to Ripple's trust-bank OCC approval, BNY custody and RLUSD's Moody's A2 as adoption groundwork. If XRP becomes core settlement infrastructure, today's market-cap valuation models would look conservative; $100 is a number, not a ceiling. x.com x.com x.com x.comÂ
Circle faces an existential threat because leaked CLARITY Act text would ban platforms from offering yield on stablecoins, directly or indirectly. Circle earns 96% of its revenue from interest on USDC reserves, and the bill also targets anything economically equivalent to interest, per @NeelMacro citing Eleanor Terrett. No yield on stablecoins means no demand for USDC, and Circle's revenue base evaporates. The stock fell 19% in a session, erasing $5.6B of market value. x.comÂ
Circle's USDC has a temporary EU go-to-market moat. The European Banking Authority gave USDC alone 'significant' stablecoin status among 45 e-money tokens under MiCA, adding a regulatory advantage to Circle's case as a sleeping giant. x.com x.comÂ
Stripe's work with Plasma on stablecoin-backed cards makes the stablecoin supercycle look absolutely massive for Plasma. Stripe says it is combining fiat and crypto infrastructure to make it easier for businesses to build cards that work across currencies and markets. x.comÂ
Circle faces real stablecoin competition as Open Standard launched its own stablecoin, Open USD, straight into USDC's lane. Circle stock fell 16.55% in 24 hours to $62, adding to last week's exit from five Russell Growth indexes. x.comÂ
Circle stands to benefit because stablecoins strip out the fees that eat into digital payments. Of 8,605 X subscriptions at $1.00, only $1,595 was paid out, with 30% App Store fees, Stripe card fees and opaque FX rounding (X charges 2 CAD for a $1 price) disappearing along the way. Stablecoins are the future, and banks are already trying to control them through Clarity Act lobbying. Issuers like Circle are preferred over individual networks like Ethereum, since USDC is blockchain-agnostic. x.com … Show more
Circle's profits face growing pressure, and the market is starting to price that in. It earns most of its money from interest on USDC reserves, and Coinbase already takes about 50% of that revenue. USDC's $73 billion market cap trails Tether's $145 billion, and Open USD is adding pressure with zero minting fees and reserve income shared with over 140 partners. x.comÂ
