Michael Sikand
Investor, Autopilot Portfolio, Founder of Sikand Media
Circle looks cheap as a tokenization play, worth only $24B while Tether is raising at a $500B valuation. Tokenization is a candidate for the next market rotation, with Securitize about to merge with CEPT to create a pure-play trade on the tokenization of the NYSE, BlackRock and others. 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
Circle's first significant e-money-token classification under MiCA gives USDC a regulatory head start over 44 other notified tokens. From November 12, the EBA directly oversees its reserves, liquidity and redemptions alongside France's ACPR. That oversight strengthens Circle's compliance moat, though the ongoing cost of dual supervision could compress margins. x.com 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 sits on the winning end of stablecoins crossing from crypto trading into global money movement, because it keeps the Treasury yield on USDC reserves while paying holders nothing. The stablecoin market grew over 50% in a year to above $310 billion, and USDC circulation rose 19% to $73.3 billion, yielding about $668 million a quarter of near-pure interest income. More adoption means a bigger balance sheet and higher interest profits, making Circle an interest-rate bet on digital cash. x.comÂ
Circle looks set to turn back into an uptrend from a massive weekly base, with insider selling pressure likely exhausted. Nearly two years after the IPO, insiders and VCs who wanted to sell are probably gone, and the crypto theme is hot. 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 is this cycle's Coinbase because the market underestimates its first-mover advantage and the growth of stablecoins over the next few years. Corporations keep launching endless stablecoins, yet Circle and Tether still reign supreme. Like Coinbase, Circle sold off after its IPO while the market underrated the business; Coinbase is in a different growth phase but should do fine. x.com x.comÂ
Circle is becoming monetary infrastructure rather than a fintech now that USDC will own its own settlement layer, Arc, which is the structural reason the stablecoin re-rating trade still has legs. Analysts have been raising Circle price targets since the Arc reveal, per CNBC. x.comÂ
Circle's valuation is far too high to consider right now, given risks from crypto sentiment and margin pressure. That holds despite strong momentum: Q4 revenue rose 77% to $770M with a solid EPS beat, it has launched institutional payment platforms and expanded African partnerships, and potential US stablecoin legislation is a tailwind. x.comÂ
Circle's real bull case is a 36-month story running through 2029, making it one of the highest-IRR opportunities in the market. The recent rally on the crypto breakout is secondary to that longer opportunity. x.comÂ
