Morgan Stanley Lowers Circle Target Price to $38
By: x.com|2026/08/03 13:20:10
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Morgan Stanley analyst James Faucette downgraded Circle (CRCL) from Equalweight to Underweight, reducing the target price from $106 to $38. Faucette noted that the contraction in USDC's scale exposes the sensitivity of Circle's reserve income, indicating that the revenue structure will shift towards lower-margin trading income. The firm has lowered its USDC scale assumptions for 2027 and 2028 by approximately 33% and 44%, respectively, leading to GAAP EPS expectations that are about 3% and 20% lower than market consensus. Tokenized money market funds and deposits threaten USDC balances and rates, and the economic structure of USDC is structurally weak; the scale of agent payments remains negligible, with an average daily trading volume of only $41,900, implying an average transaction amount of about $0.24. Open USD has introduced shared governance and reserve economic models, increasing the cost of maintaining USDC distribution.
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