Circle defends USDC strategy as CRCL drops amid new stablecoin competition

USDC strategy over stock volatility

Tarbert said Circle’s management is focused on building financial infrastructure rather than reacting to swings in CRCL shares. He said the company is taking a long-term approach and maintained that strong execution should eventually translate into value for shareholders.

In defending USDC’s position, Tarbert pointed to the token’s scale and distribution. He said USDC has roughly $73 billion in circulation and is natively supported across 34 blockchains, network effects he said would be extremely difficult for competitors to recreate quickly. Circle describes USDC as a regulated digital dollar used in trading, payments and settlement.

New entrant adds pressure

The timing of Tarbert’s comments is notable. Open Standard has launched Open USD, a planned stablecoin that it says is backed by more than 140 participating businesses. The list includes Visa, Mastercard, Stripe, BlackRock, BNY and Coinbase.

According to Open USD, partners will be able to mint and redeem the token without fees and receive reserve earnings after a management charge. That structure has added to market concern that alternative stablecoin models could put pressure on Circle’s business model.

Circle shares fell 17.5% to $62.63 after Open USD entered the market. The stock also exited several Russell Growth indexes, adding to investor unease at a time when the stablecoin sector is attracting larger and more varied challengers.

Analysts reassess earnings outlook

JPMorgan has lowered its earnings forecasts for both Circle and Coinbase. The bank tied that move to a new revenue-sharing agreement linked to USDC balances on Hyperliquid, suggesting that stronger adoption may come with lower reserve income retained by the companies.

That dynamic has become a central concern for the market: wider distribution can support usage, but the economics of that growth may change if more revenue must be shared with partners and platforms.

Tarbert pushed back on the broader competitive threat, saying rivals cannot easily replicate USDC’s current reach. He described USDC as the largest regulated stablecoin and said it leads in actual transaction volume, presenting scale and existing distribution as Circle’s key advantages.

Regulated infrastructure remains a focus

Alongside the defense of USDC, Circle has continued to expand its regulated operating footprint. The company recently received final approval from the Office of the Comptroller of the Currency to establish Circle National Trust.

The trust bank will initially provide digital asset custody. Circle has also indicated that USDC reserve management could become a future service of the entity, underscoring the company’s effort to deepen its role in regulated digital asset infrastructure.

The latest debate around Circle reflects a broader shift in the stablecoin market, where scale, distribution and regulatory positioning are increasingly being weighed against new partnership-driven models that promise cheaper access and shared reserve income. For now, Circle’s leadership is presenting USDC’s existing footprint as its main defense against that pressure.