Circle could rally 60% more on stablecoin adoption, AI agentic finance, Bernstein says

• Bernstein analysts said USDC stablecoin issuer Circle's (CRCL) shares could rally to $190, implying about 60% additional upside after the stock doubled over the past few weeks.
• Stablecoin adoption is diverging from crypto market cycles, with USDC supply near record highs of $78 billion despite the crypto bear market.
• Payments growth and potential AI-driven micropayments are emerging as new demand drivers, the report said.

Shares of Circle (CRCL), the crypto firm behind the USDC (USDC) stablecoin, could add to their recent remarkable surge, according to analysts at brokerage Bernstein.

The team, led by Gautam Chhugani, rate the stock at outperform with a $190 price target, suggesting about 60% upside from current $120 level. And that's after the stock rallied more than 100% in the past few weeks following an earnings beat, which likely triggered a short squeeze.

Bernstein’s thesis centers on stablecoin adoption increasingly diverging from the broader crypto market.

Circle’s USDC supply briefly fell after the October liquidity shock in crypto markets but has since rebounded to just shy of its record $78 billion, even as bitcoin BTC$69,951.35 and the broader crypto markets remain well below its highs. The total market for U.S. dollar-backed stablecoins also remained steady at around $270 billion despite the crypto bear market, the report noted.

Transaction activity is accelerating as well, the report noted. Adjusted stablecoin volumes grew more than 90% year-over-year, while transaction velocity — a measure of how frequently tokens change hands — has increased, suggesting stablecoins are increasingly used beyond crypto trading.

Payments adoption is a key driver behind that, Bernstein said, as stablecoins are increasingly getting embedded with traditional card networks, enabling everyday transactions. Visa (V), for example, now supports more than 130 such stablecoin-linked cards across 50 countries, processing roughly $4.6 billion in annualized settlement volume, the report noted.

Circle is also expanding its Circle Payments Network, which allows institutions to send USDC cross-border and convert it into local currencies through banking partners. The network now includes about 55 institutions, with annualized volumes reaching $5.7 billion earlier this year, the report said.

Looking ahead, Bernstein also highlighted a potential new growth theme: AI-driven "agentic finance." As autonomous software agents increasingly transact online, stablecoins could become a natural payment rail for micropayments between machines, such as for API calls or automated services.

To support that vision, Circle is building a high-throughput, payments-focused blockchain called Arc, designed for fast, low-cost transactions.

Read more: Why Circle and Stripe (And Many Others) Are Launching Their Own Blockchains

• Disrupting a Stagnant Market: Pudgy Penguins is utilizing a "Negative CAC" model to challenge the traditional $31.7B licensed toy industry by treating physical merchandise as a profitable user acquisition tool rather than just a final product.

• The x402 protocol aims to enable "agentic payments" by embedding stablecoin micropayments directly into the internet’s communication layer so AI agents and software can pay each other automatically.
• Despite a roughly $7 billion ecosystem valuation, onchain data shows that x402 currently processes only about $28,000 in daily volume, much of it from testing and "gamed" transactions rather than real commerce.
• Supporters argue that x402’s true utility will emerge as more AI-driven, pay-per-use services come online, but for now the narrative around agentic commerce is running ahead of actual adoption.

Disclosure & Polices: CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of Bullish (NYSE:BLSH), an institutionally focused global digital asset platform that provides market infrastructure and information services. Bullish owns and invests in digital asset businesses and digital assets and CoinDesk employees, including journalists, may receive Bullish equity-based compensation.