Rising silently, is Circle underestimated in the red ocean of stablecoins?

Core Viewpoint

2026-01-26 21:20:00

Collection

Circle demonstrates significant competitive advantages in the stablecoin sector, with its core value not only stemming from USDC itself but also from the payment and settlement ecosystem it has built.

Author: Frank, IOSG

I. Circle vs Tether: Full-scale Battle in 2026

On December 12, 2025, Circle received conditional approval from the Office of the Comptroller of the Currency (OCC) to establish a national trust bank—First National Digital Currency Bank. Once fully approved, this key milestone will provide trusted digital asset custody services to top global institutions, helping the market value of stablecoins accelerate to $1.2 trillion within three years. With this momentum, Circle successfully went public in 2025, and the accelerated circulation of USDC has made it the stablecoin issuer most closely connected to institutional investors. As of now, its valuation has reached $23 billion. ▲ Source: IOSG Ventures Although Tether, the leader in the stablecoin market, maintains a high profitability of over $13 billion, its parent company faces ongoing commercial reputation and regulatory pressures. For example, recently S&P downgraded Tether's reserve rating from "strong" to "weak," and Juventus Football Club rejected its acquisition offer. On November 29, the People's Bank of China held a special meeting to crack down on virtual currency trading, clearly pointing out that stablecoins have flaws in customer identity verification and anti-money laundering, and are often used for money laundering, fraud, and illegal cross-border fund transfers. The regulatory focus essentially targets the offshore stablecoin system represented by USDT. USDT dominates emerging markets in Asia, Latin America, and Africa, especially with a market share exceeding 90% in East Asia, where a large amount of circulation occurs in off-chain P2P and cross-border fund activities, long evading regulatory systems and viewed as a "gray dollar system" that exacerbates capital outflow and financial crime risks. ▲ Source: Visa Onchain Analytics In contrast, the paths taken by the U.S. and the EU are not about a full crackdown but rather about incorporating stablecoins into the regulatory framework through high compliance. For example, the U.S. GENIUS Act explicitly requires stablecoins to establish a 1:1 high-quality reserve, undergo monthly audits, obtain federal or state licenses, and prohibits the use of high-risk assets like Bitcoin and gold as reserves.

In other words, China aims to compress the "shadow dollar system of offshore stablecoins" from the source, while Europe and the U.S. attempt to establish a "controllable, compliant, and regulated digital dollar system." The commonality of these two paths is that neither is willing to allow opaque, high-risk, and un-auditable stablecoins to occupy a systemic position. This means that compliant issuers like Circle can enter the financial system, while offshore stablecoins like Tether will gradually be excluded from developed markets in the future. This is also why Tether has recently begun to vigorously develop its USAT, its first U.S. compliant stablecoin. ▲ Source: Artermis While Tether may still maintain its dominance in offshore and emerging markets, over the past year, Circle's USDC net supply has also increased by $32 billion, second only to USDT's $50 billion.

However, Circle has made significant progress in challenging Tether in offshore and emerging markets, with its market share in India and Argentina reaching 48% and 46.6%, respectively. The main reason for the increased status of Circle's USDC in these offshore markets is the explosive growth of its crypto card business in recent years. ▲ Source: Artermis Crypto cards enable users to spend stablecoins and cryptocurrency balances at traditional merchants, becoming one of the fastest-growing segments in the digital payments space. Transaction volume has grown from approximately $100 million per month at the beginning of 2023 to over $1.5 billion by the end of 2025, with a compound annual growth rate of up to 106%. Year-on-year, this market size has now exceeded $18 billion, comparable to the $19 billion in peer-to-peer stablecoin transfers, which only grew by 5% during the same period. ▲ Source: Artermis The opportunity for stablecoin cards lies in their ability to address real needs in many offshore markets, rather than just being a gimmick. Many users in India cannot access credit through traditional banks, and cryptocurrency-backed credit cards precisely meet this demand. Meanwhile, the people of Argentina face severe inflation and currency devaluation. Stablecoin debit cards help people preserve value by holding assets pegged to the dollar.

Stablecoin cards require access to Visa or Mastercard networks for transactions with local merchants, making USDC the most suitable compliant stablecoin, thus gaining a significant share of transaction volume in these offshore regions and countries where these stablecoin cards are popular. As a result, we can see Circle and Tether intensifying competition in their respective areas of expertise, and it remains difficult to say who has the upper hand in the short term.

Of course, from a valuation perspective, the two are not even in the same league, with USDT's OTC valuation reaching $300 billion, and Bloomberg reported that it recently raised up to $20 billion at a valuation of $500 billion. Meanwhile, Circle's latest market price is only $18.5 billion. ▲ Source: Bloomberg The premium on Tether's valuation, aside from its market monopoly, is influenced by many other factors, but the primary factor is the advantage of Tether's business model, which does not require profit-sharing with Coinbase like Circle does. According to Circle's S-1 filing, Coinbase earns 100% of the reserve income on USDC held on its platform, while for USDC outside its own platform, such as those held on other exchanges, DeFi protocols, or personal wallets, the interest income generated is split 50/50 between Circle and Coinbase. ▲ Source: Beating According to Beating's compilation, Coinbase's revenue in Q3 2025 reached $354.7 million, which is 50% of Circle's interest income of $711 million during the same period. In other words, for every $2 of interest Circle earns, it has to share $1 with Coinbase.

In addition to not having to share profits, Tether's USDT has a significant advantage in that it does not have to adhere to collateral restrictions. If Circle adopts an extreme "conservative strategy" for reserves: 85% in short-term U.S. Treasury bonds with maturities not exceeding 90 days and overnight reverse repurchase agreements, and 15% in cash and cash equivalents, all held by BlackRock or BNY, with monthly audit reports issued by accounting firm Grant Thornton LLP, ensuring a 1:1 coverage of circulation and reserves that can be verified in real-time. ▲ Source: CoinLaw In contrast, we can see that USDT's collateral is more diversified compared to Circle's, thus yielding higher reserve income, especially in the current macro context of rising gold prices and spreading risk aversion in the market.

This inevitably raises the question: Is a highly compliant and regulatory whitelist path a good business for compliant stablecoins?

II. Circle's Financial Report: Comprehensive Growth in Q3

First, let's review Circle's main revenue model and earnings as a stablecoin company. Circle's stablecoin is backed 1:1 by cash and short-term U.S. Treasury bonds, which can generate substantial interest income in a high-interest-rate environment.

In the third quarter of this year, Circle's revenue reached $740 million (of which interest income alone generated $711 million), beating the expected $707 million, with a year-on-year (YoY) growth of 66%. However, the month-on-month (MoM) growth rate slightly declined from 13.6% in the previous quarter to 12.5% this quarter, but overall remains at the same level.

The circulation of USDC nearly doubled, with an adjusted EBITDA profit margin of 22.5%. This rare combination of growth and profitability has made it stand out in the fintech sector, becoming one of the few examples of high growth and high profit in the industry. ▲ Source: Circle Q3 Earnings This quarter, the company's total quarterly profit (RLDC) reached $292 million, significantly exceeding market expectations, with growth rates consistent with the previous two quarters. RLDC (Revenue Less Distribution and other Costs) is calculated as total revenue minus distribution, transaction, and other related costs. The RLDC profit margin (RLDC Margin) is the percentage of RLDC in total revenue, used to measure the profitability of core business.

Operating income also significantly beat market expectations, while the previous quarter's operating income was negative, mainly due to one-time stock-based compensation, with $424 million in SBC (employee compensation) and $167 million in debt extinguishment charges. Therefore, for easier comparison, we use adjusted EBITDA to add back non-core, one-time expenses like depreciation, amortization, taxes, and stock-based compensation, reflecting the recurring operational performance of the core business. From the performance of adjusted EBITDA, both year-on-year and month-on-month are accelerating, with a YoY increase of 78%, MoM increase of 78%, and a significant increase of 31% compared to the previous year, also greatly exceeding market expectations.

We can see that Circle's core revenue source is the interest generated from reserve assets. However, this revenue model is very fragile and is directly affected by macro interest rates. Therefore, Circle's biggest challenge is whether it can quickly reverse its single, fragile stablecoin revenue model and open up diversified revenue channels. ▲ Circle Q3 Earnings Therefore, the financial report focuses on the growth rate of other income and the growth rate of other income as a proportion of total revenue. As long as these two items can continue to grow, it indicates that Circle's revenue model is improving. Conversely, if the growth rates of these two items decline, it would be a bearish signal.

It can be seen that other income is $28.5 million, significantly exceeding market expectations. However, given that the base from the same period last year was only $1 million, the year-on-year data is of limited reference value. More meaningful month-on-month data shows that this quarter's growth rate is 20%, an acceleration from 15% in the previous quarter, indicating that this income segment is indeed growing rapidly. However, "other income" currently accounts for less than 4% of total revenue, and changing Circle's single revenue structure will take time.

Nevertheless, this is still a positive signal. Expecting a fundamental transformation of the revenue model within just six months is unrealistic; the current steady month-on-month growth has laid a good foundation for future diversification. ▲ Source: Circle Q3 Earnings From a more macro perspective, the stablecoin market is experiencing rapid growth, with overall circulation increasing by 59% year-on-year, and on-chain transaction volume reaching 2.3 times that of the same period last year, showing immense market potential.

In this context, USDC's performance is particularly outstanding, with its market share steadily climbing to 29%. It is noteworthy that even in the face of competition from emerging stablecoins like Phantom $CASH, USDC's upward trend has not been interrupted.

Currently, there is a general concern in the market: will the issuance of more stablecoins lead to USDC no longer being the best stablecoin choice? From platforms providing "stablecoin issuance as a service" (such as Bridge, M0, and Agora) to numerous companies entering the space, these phenomena seem to indicate that the industry will fall into excessive competition, eroding long-term profitability. However, this viewpoint largely overlooks a key market reality.

The growth in USDC's market share is primarily attributed to the favorable environment created by regulatory progress such as the Genius Act. As the leader in compliant stablecoins, Circle occupies a unique strategic high ground. Globally, whether in the U.S., Europe, Asia, or in regions like the UAE and Hong Kong where stablecoins are regulated, mainstream institutions tend to prefer compliant infrastructures like Circle that possess trust, transparency, and liquidity as their first-choice partners; otherwise, their related businesses would be difficult to operate.

Therefore, regarding concerns that emerging stablecoins may challenge USDC's market position, we believe this viewpoint is difficult to establish. On the contrary, USDC is not only likely to solidify its second position for a long time but also has the strength to challenge the market leader with its unparalleled compliance advantages, with the network scale effect barrier potentially lasting 2-3 years. ▲ Source: Circle Q3 Earnings USDC's on-chain activity is experiencing explosive growth. Its on-chain transaction volume has soared to $9.6 trillion, 6.8 times that of the same period last year.

This growth is attributed to the success of its Cross-Chain Transfer Protocol (CCTP). CCTP enables seamless and unified circulation of USDC across different blockchains by destroying it on the source chain and natively minting it on the target chain, avoiding the complexities and risks of traditional cross-chain bridges.

Overall, whether in terms of on-chain transaction volume, CCTP usage data, or the growth in the number of active wallets (with balances greater than $10), all indicators point to the same conclusion: the adoption rate and network speed of USDC are continuously and significantly expanding. ▲ Source: Visa In terms of ecological cooperation, Visa announced on December 16 that it would open USDC stablecoin settlement services to the U.S. network, allowing U.S. financial institutions (with Cross River Bank and Lead Bank as the first users) to settle with Visa using USDC via the Solana blockchain.

For those familiar with the stablecoin B2B Payment Landscape, Cross River Bank and Lead Bank are among the most crypto-friendly licensed banks in the U.S. For example, Cross River Bank and Lead Bank act as sponsor banks for companies like Baanx and Bridge, allowing fintechs without banking licenses to "borrow" their qualifications to issue bank cards or even launch white-label card issuance services. For B2B stablecoin payment companies, they can also access traditional payment networks, such as Visa/Mastercard Principal Membership, using VisaNet, MastercardNet, and traditional payment channels like ACH, FedWire, and RTP for fiat settlement.

▲ Source: IOSG Ventures The significance of this cooperation lies in allowing Visa's partner institutions to convert all settlement transactions of their Visa cards to USDC without changing the consumer card experience, enabling banks and fintech companies to settle seven days a week, replacing the traditional five-day settlement window, thereby enhancing the speed and liquidity of fund circulation. In the past, although Visa could authorize transactions at 150 million merchant points globally 24/7, settlements were still limited by bank operating hours, wire transfer cut-off times, and holiday arrangements. For example, if a transaction is authorized on Friday and the bank is closed on Monday, the settlement would not be completed until Tuesday.

For Visa, stablecoins and blockchain can be seen not as threats but as new strategic entry points. Visa's logic is simple: vigorously promote Stablecoin-linked Visa cards. Because, regardless of how payment methods change, consumers ultimately need to convert stablecoins into fiat currency to make purchases, and this "fiat landing" step must first go through VisaNet for clearing before interbank settlement of fiat currency. Currently, the vast majority of cryptocurrency card transaction volumes are settled through fiat clearing (the first method in the next image), meaning that 24/5 clearing remains the default option as it requires no merchant integration. The conversion from cryptocurrency to fiat is completed before settlement to the payment network, so when the transaction reaches the network, the transaction from the cryptocurrency card is indistinguishable from any other card payment, meaning that from the merchant's clearing perspective, there is no change; it is all fiat, with the advantage lying in the user deposit side, allowing them to spend crypto without relying on SWIFT for deposits. ▲ Source: Artermis Even if Visa begins a USDC settlement pilot, achieving 24/7 settlement, this is not a threat to Visa; rather, it aligns with its strategic interests. The integration of stablecoins has not changed its underlying business logic. All stablecoin card transactions still need to go through VisaNet and pay a "toll." Visa's core profit model relies on three main revenue sources: interchange fees charged to issuing banks, acquiring service fees charged to acquiring banks, and network clearing fees charged through VisaNet. Therefore, Visa has no need to issue stablecoins itself. Its strategy is clear: continuously onboard more stablecoin issuers (like Bridge, Rain, Reap, etc.), support more stablecoin types (like USDC, EURC, USDG, PYUSD), and connect more blockchain networks (Ethereum, Solana, Stellar, Avalanche). The only goal is to let more transaction volume flow through its network. Visa's moat lies in its control of the merchant-side channel entry. Regardless of how on-chain transactions occur, the "last mile" of fiat clearing is always tied to VisaNet, this "single bridge," allowing Visa to firmly grasp the power to collect tolls. As of November 30, Visa's stablecoin settlement pilot business has reached a monthly transaction volume of $3.5 billion, a milestone with a year-on-year growth of approximately 460%.

Traditional process:

Swipe card → VisaNet authorization → VisaNet clearing → Interbank settlement (T+1~T+3, through the banking system)

Stablecoin settlement process:

Swipe card → VisaNet authorization → VisaNet clearing → USDC settlement (real-time, on-chain)

　　　　　　　　　　　　　　　　　　　　↑

　　　　　　　　 Only change this step!

But if Visa does not participate:

User → Stablecoin wallet → Merchant directly receives USDC → Visa is bypassed ✗

For Circle, this cooperation consolidates its position as a top compliant stablecoin with institutional endorsement and opens up an important channel from crypto-native users to traditional financial institutions. However, due to the high liquidity and short settlement time of such settlement funds, the contribution to Circle's interest income is minimal in the short term. According to estimates by blogger Didier, the "working inventory balance" generated from this only accounts for about 0.09% of the current total issuance of USDC.

Therefore, the short-term value of this cooperation lies in "laying the pipeline," while its long-term potential depends on whether the flow of funds through this pipeline can significantly increase, thereby bringing more substantial income from deposited funds to Circle. In simple terms, Circle is "making friends" everywhere, expanding the use of USDC. On the trading asset side, we have also seen USDC integrated into trading platforms like Kraken, Fireblocks, and Hyperliquid, which cater to retail, institutional, and on-chain users. Meanwhile, the company is also accelerating cooperation with banking infrastructure and the retail end of digital dollars. These initiatives collectively enhance Circle's network effects and the breadth of application scenarios, laying a solid foundation for the transformation of its future revenue model. ▲ Source: Circle Q3 Earnings

III. Strategic Transformation in 2026: From "Minting" to "Ecosystem"

▲ Source: Circle's 2025 Year in Review In the previous analysis of the financial report, we mentioned that Circle's urgent task is to expand other income and briefly mentioned CCTP. From Circle's strategic layout announced for 2026, we can clearly see its breakthrough thinking.

Among them, I personally believe that the two categories of other income that are relatively likely to improve in the short term are:

Transaction service fees: This includes minting/redemption fees, large transfer fees, etc. To understand the potential of this income, we must look at the macro data behind it: this year, the total transaction volume of the USDC stablecoin network reached an astonishing $4.6 trillion. By providing large-scale minting and redemption services for exchanges and institutions through Circle Mint, charging a transaction fee of 0.1%-0.3%, this business generated $3.2 million in revenue in Q3 2025. The self-developed CCTP cross-chain and technical services have supported seamless transfer of USDC across 23 public chains, charging a fee of 0.05% on cross-chain amounts, contributing $2.8 million in revenue in Q3 2025.
RWA tokenization services, through the acquisition of Hashnote to launch the tokenized treasury fund USYC, charging an annual management fee of 0.25%, currently managing a scale of $1.54 billion. When it was acquired last January, over 97% of the USYC tokenized treasury fund was purchased and held by Usual Protocol as its USD0 stablecoin's reserve asset. However, after the acquisition, Circle is introducing USYC to more exchanges and distribution channels, amplifying its role as a compliant income-generating asset.

One of the most notable recent developments is Deribit's integration of USYC. As a leading crypto derivatives exchange, Deribit now supports USYC as collateral for trading futures and options.

This integration brings multiple advantages:
Collateral can generate income while securing trading positions.
Compared to using non-yielding stablecoins, the opportunity cost is lower.
The appreciation of collateral may reduce overall trading costs.
Maintaining liquidity, allowing for withdrawal at any time when needed.

For active traders, this means that even your "idle" trading funds can continuously generate income as collateral—something traditional margin models cannot achieve. If we look even further ahead, the long-term categories of other income that are most likely to improve for Circle are these two:

First, Circle's self-built Arc public chain: The ARC public chain's public testnet is now online, with over 100 companies globally participating in testing, including several well-known large institutions. The management expects the mainnet to officially launch in 2026. All participants in the developer ecosystem can seamlessly access this infrastructure, and this public chain will also be deeply integrated with various platforms under Circle. Additionally, management is actively exploring the possibility of launching an ARC native token.

▲ Source: Circle Q3 Earnings Its core significance is:

Vertical integration: Transaction medium (USDC) + Channel (Coinbase, Visa) + Settlement layer (ARC public chain)
Value capture recovery: In the past, USDC ran on Ethereum and Solana, with gas, MEV, and ecological value taken by other public chains; ARC allows Circle to reclaim this portion of value.

▲ Source: Circle Second, CPN (Circle Payments Network): A B2B payment network for institutions, providing cross-border payment and settlement services based on USDC for large enterprises and financial institutions.

If ARC is the underlying operating system, then CPN is the top-level application. Three major products have been launched: CPN Console, CPN Marketplace, and CPN Payouts.

What does CPN aim to disrupt?

The traditional cross-border payment chain: SWIFT + correspondent banks + local clearing systems (such as U.S. ACH)
If using stablecoins for clearing and settlement, the above intermediaries can be eliminated—CPN directly maintains the ledgers of all participants within the network.
In contrast, while Airwallex has bypassed SWIFT and correspondent banks (by pre-funding pools in various countries), it still relies on local clearing systems and requires bank accounts.
The ultimate vision of CPN: No need for bank accounts at all.

Although CPN has currently accumulated about 500 potential clients, management has made it clear that the current phase's goal is not monetization but focusing on user quality and continuously expanding network scale. Once network effects are formed in the future, there will be ample space to charge fees far below traditional models—this is the core of Circle's second growth curve.

Conclusion: Circle's Moat and Long-term Value

Circle demonstrates significant competitive advantages in the stablecoin space, with its core value not only stemming from USDC itself but also from the payment and settlement ecosystem it has built. The future stablecoin market may present a "Winner takes most" pattern, and Circle has already established a leading position through three major moats:

Network Effects: USDC has the broadest coverage and best interoperability, forming a strong ecological flywheel. If users or merchants do not adopt USDC, they may lose substantial opportunity costs.
Liquidity Network: USDC has the most comprehensive and extensive integrated liquidity network, providing strong support for transactions and settlements.
Regulatory Infrastructure: Circle has obtained 55 regulatory licenses, making it the most compliant stablecoin, building a solid compliance moat. In the U.S., legislation like the Genius Act and a clear regulatory framework provide Circle with significant compliance certainty, which many other crypto companies lack.

▲ Notebook LLM Generated With the stablecoin market expected to reach a total issuance of $2 trillion by 2030, Circle is poised to maintain its dominant position in the digital dollar ecosystem, leveraging its core moats and execution capabilities. Despite facing challenges such as a low-interest-rate environment, a single revenue model, and high profit-sharing costs, Circle is transitioning its business model from a purely interest margin revenue model to a network service and infrastructure model centered around USDC. Its highly compliant path may increase operational costs in the short term, but in the long run, it can solidify regulatory advantages, allowing it to capture value from the global traditional finance and institutional markets.

This logic is similar to the mobile payment landscape in China: WeChat Pay and Alipay dominate almost all daily payment scenarios. If a merchant does not adopt these two payment tools, they will miss out on a large number of customers, severely impacting revenue. This also explains why emerging payment methods, such as Douyin Pay, find it difficult to expand rapidly in a short time—despite having powerful product features, without a user base and merchant access network, it is challenging to reach critical mass and activate the ecological flywheel.

Similarly, USDC has established a comparable "first-mover advantage" in the digital dollar payment and settlement ecosystem, with its network effects and interoperability making it difficult for new competitors to shake its existing position. For merchants and institutions, adopting USDC is not only about transaction convenience but also a necessary condition for market access.

In terms of other advantages, Circle's business model has very high marginal benefits and scalable revenue.

The interest income generated from stablecoin reserves will scale rapidly with its issuance, while the growth rate of its operating costs is much slower, resulting in very high marginal profits.

Moreover, Circle's leadership has repeatedly demonstrated resilience during crises, earning recognition for its team. During the USDC de-pegging crisis caused by SVB in 2023, it proved its strong crisis management and execution capabilities. When Silicon Valley Bank (SVB) collapsed, Circle had part of its USDC reserves stored in SVB, and the market was once concerned about the safety of USDC's 1:1 dollar reserves, resulting in a brief de-pegging (falling below $1). Circle's core actions at that time included:

Rapid disclosure of facts: Clearly stating how much funding was exposed to SVB, rather than being vague.
Continuous updates: Constantly synchronizing the latest developments with the market, rather than going "dark."
Clear commitment to results: Emphasizing that even with losses, Circle would back USDC's 1:1 redemption.

The team successfully stabilized market confidence through decisive and transparent communication. The company is also recruiting experienced leadership, with its latest president in 2025 being former CFTC chair Heath Tarbert, who held high-level government positions such as Assistant Secretary of the U.S. Treasury before joining Circle.

From a short-term perspective, Circle still faces certain structural and market pressures. First, as global monetary policy gradually enters a rate-cutting cycle, the decline in interest rates will directly compress Circle's income source centered on reserve interest, significantly amplifying its sensitivity to macro interest rate changes in the short term. Meanwhile, the company's current revenue model is relatively singular, highly dependent on the scale and interest rate level of USDC, lacking sufficient diversified non-interest income buffers. Second, to maintain the circulation scale and network effects of USDC, Circle needs to pay a high proportion of profit-sharing costs to distribution channels such as exchanges and payment platforms, which may further erode profit margins during periods of slowing growth.

On the market side, the stock price has recently continued to weaken and is operating below the 50-day moving average, maintaining around $80 per share, reflecting cautious short-term capital sentiment, with technical indicators still under pressure. The main reason comes from the unlock after December 2, 2025, which is 180 days after the IPO date. The scale of the unlock is very large, essentially a full circulation-level shock; before the unlock, the shares circulating in the market accounted for only about 17.2% of the total share capital. After the unlock, theoretically, almost all shares can be traded, instantly increasing the circulating supply by nearly 400%. The selling pressure after the unlock mainly comes from early investors and management, most of whose holding costs are below $10. Insiders can continue to reduce their holdings through 10b5-1 trading plans. For example, director Patrick Sean Neville sold 35,000 shares at $90/share on December 12, 2025.

In addition, Circle's biggest short-term risk is that many investors may choose to short Circle during a declining interest rate period, treating Circle as a hedging tool against interest rates. However, Circle's potential growth point lies in its diversified ecosystem; Circle is not just a USDC issuer; it is also building a comprehensive fintech ecosystem that includes payment, trading, and Web3 services, which helps to increase its revenue sources and lock in users.

Overall, Circle's long-term value is clear, but short-term volatility should be tolerated, as technical and macro uncertainties may lead to continued fluctuations. In summary, Circle's current stock price appears to be undervalued relative to its intrinsic value. Currently, Wall Street's DCF model gives an intrinsic value range of $142 per share, higher than the current market price, indicating a certain margin of safety at the fundamental level. It is worth noting that due to Circle's stable cash flow, clear regulatory status, and relatively controllable risk exposure, Circle's WACC is only 4.02%, a level closer to low-risk, highly predictable cash flow utility companies rather than typical high-volatility tech or crypto firms, reflecting that the capital market views its core cash flow as stable and defensive assets.