Crypto Stocks Slide as Bitcoin Surges Past $72K Amid Easing Geopolitical Tensions

Cryptocurrency-related stocks took a hit Thursday even as broader markets rallied and Bitcoin climbed to its highest point in over three weeks. The divergence highlighted growing concerns about profit margins and valuation among major digital asset companies.

Circle Internet Financial (CRCL) led the declines, dropping nearly 10% to close at $85.10. The sell-off followed a downgrade from Compass Point, which shifted its rating to Sell and trimmed its price target to $77. Analysts flagged that while Circle's USDC stablecoin has shown resilience compared to previous market downturns, supply growth is increasingly concentrated in lower-margin distribution channels. Platforms like Sky, Binance, and Ethena, where revenue-sharing agreements eat into Circle's earnings, now hold a growing portion of USDC supply. Compass Point also raised concerns that the stock's current valuation — roughly 40 times projected 2027 adjusted EBITDA — looks stretched, and warned that consensus earnings forecasts for 2026 and 2027 could face downward revisions as gross margins compress in the first half of next year.

Crypto exchange operator Bullish (BLSH) also fell, losing 6.5% to settle at $36.12 after Rosenblatt downgraded shares to Neutral. The firm noted that Bullish now trades at a premium to peers including Coinbase (COIN) and Robinhood, while revenue tailwinds from its IPO are expected to fade alongside softer crypto trading volumes.

Bitcoin, however, told a different story. The leading cryptocurrency pushed above $72,000, buoyed by signs of de-escalation in Middle East tensions. Israeli Prime Minister Benjamin Netanyahu announced direct negotiations with Lebanon following calls from U.S. envoy Steve Witkoff to scale back military activity — a notable pivot given Washington's earlier posture.

The broader market also moved higher, with the Nasdaq gaining 0.8% and the S&P 500 advancing 0.6%.