Bernstein Reaffirms Bullish View on Circle Despite Mixed Earnings, Cites Arc Launch

Wall Street is split on Circle as the stablecoin issuer digests a mixed second-quarter earnings report, but Bernstein is doubling down on a bullish view—arguing that investors are missing the bigger story: regulatory de-risking, expanding payments infrastructure, and an imminent launch of Circle’s new layer-1 blockchain.

Following Circle’s Q2 results, Bernstein reiterated an ‘Outperform’ rating and maintained a $140 price target. With Circle shares recently changing hands in the mid-$64 range, the target implies roughly 121% upside from current levels. Intraday trading was volatile, with shares moving between $60.03 and $65.90 on volume of about 11.33 million shares. The stock’s 52-week range stands at $49.90 to $189.92, underscoring how quickly sentiment has swung around the company’s growth narrative.

Circle’s earnings themselves provided ammunition for both bulls and bears. Market reports characterized Q2 revenue as coming in below consensus expectations, while profitability metrics exceeded estimates. The initial reaction was negative—some outlets noted shares fell close to 4% early in the session on the revenue miss—before buyers stepped in and pushed the stock into positive territory later in the day. By mid-session, prints around $64.70 were reported, and other market updates cited a move to $65.29, roughly a 3.18% gain at that point.

The rebound suggests a market increasingly focused on longer-term catalysts rather than quarter-to-quarter volatility. That framing aligns with Bernstein’s thesis that perceived risks are being mispriced relative to the scale of Circle’s potential ‘infrastructure moat’ in regulated digital dollars.

At the center of Circle’s bull case is USDC (USDC), its dollar-backed stablecoin. USDC circulation has reportedly climbed to about $73.3 billion, up 19% year-over-year—an acceleration that analysts often treat as a proxy for product-market fit across exchanges, payments rails, and onchain settlement. USDC remains the No. 2 stablecoin by market size behind Tether (USDT), and proponents argue that Circle’s emphasis on compliance and transparency positions it well as U.S. regulatory expectations become clearer.

A major near-term milestone is Circle’s planned launch of the Arc public mainnet, scheduled for September 16 (U.S. Eastern Time). Arc is described as a purpose-built layer-1 blockchain developed by Circle for ‘institution-grade’ security and scalability—an attempt to bring stablecoin settlement into a more controlled, high-assurance environment.

Circle has also spotlighted a roster of founding validators that includes BlackRock, Visa ($V), Mastercard ($MA), Depository Trust & Clearing Corporation (DTCC), Galaxy Digital, Intercontinental Exchange ($ICE), Global Payments ($GPN), MoneyGram, SBI Group, Standard Chartered ($STAN), and Sumitomo Corporation. Market participants see this validator lineup as a signal that traditional finance is increasingly willing to engage not only with stablecoins as instruments, but with the underlying blockchain infrastructure that moves them.

On the regulatory front, Circle has secured approval from the Office of the Comptroller of the Currency (OCC) to establish Circle National Trust, according to reports. The step is being framed as a significant credibility marker: a pathway to operating under a federal trust bank structure that could expand Circle’s ability to offer regulated financial services and deepen institutional participation around USDC and related products.

Not everyone is convinced. While Bernstein held firm on a $140 target, other firms have taken a more cautious stance. Needham reportedly lowered its price target to $127, and Morgan Stanley reduced its target to $37 while maintaining an ‘Underweight’ rating, citing concerns tied to the trajectory of USDC growth. The divergence highlights a central debate: whether Circle’s expanding footprint translates into durable revenue streams, and how defensible its economics remain as competition in tokenized dollars intensifies.

Intraday tape action reflected that push-and-pull. Shares opened around $61.24, slid into the low $60s early, then steadily recovered—reclaiming $62 by late morning and pushing above $63 in the afternoon before topping out near $65.90. Trading interest spiked around late morning and mid-afternoon, contributing to wider swings as investors repositioned after earnings.

For now, Circle’s trajectory appears increasingly tied to three variables: sustained USDC circulation growth, real-world adoption of the Circle Payments Network, and whether Arc’s mainnet launch can convert high-profile institutional participation into meaningful onchain activity. The post-earnings recovery suggests the market is willing to look past near-term revenue softness, but the wide spread in analyst targets signals that conviction on the company’s long-term model remains far from unanimous.