Circle’s Stock Plummets Amid Ark Sell-Off and Fed Rate Cut Speculation

Circle Internet Financial's stock has tumbled more than 35% from its June peak, erasing $28 billion in market value as post-IPO euphoria fades. The stablecoin issuer now trades at $192, a far cry from JPMorgan's $80 price target issued alongside its neutral rating initiation.

Concerns over Circle's valuation persist as its $42 billion market cap dwarfs both financial metrics and the $62 billion backing of its USDC stablecoin. The company reported $1.67 billion revenue and $267 million net income for 2024, translating to a frothy 157 P/E ratio that suggests overextension.

USDC's growth stagnation compounds these worries. With its market cap flatlining near $61.6 billion for months, Circle faces revenue headwinds from both stablecoin supply limits and impending Fed rate cuts. Chairman Powell's recent comments hint at possible July easing, which WOULD compress yields on Circle's Treasury-backed revenue model.