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Bernstein reiterates optimism for Circle: Q2 performance alleviates concerns over stablecoin competition, maintains target price of $140

According to The Block, research firm Bernstein reaffirmed its "Outperform" rating and maintained a target price of $140 after Circle announced its Q2 2026 financial results, believing that the company's latest performance constitutes a "reverse validation" of the market's bearish views. Bernstein analysts stated that the market currently underestimates USDC's long-term growth potential and Circle's advantages in distribution channels, liquidity, and regulatory compliance, due to two major core concerns regarding Circle—intensifying competition in stablecoins and changes in the interest rate environment that may affect reserve income.Investors may not have fully accounted for the future revenue opportunities from transaction fees, partner ecosystems, and the Arc blockchain that Circle could generate. The firm specifically pointed out that several infrastructure initiatives recently advanced by Circle, including obtaining a national trust bank license in the U.S., expanding the Circle Payments Network, and the planned launch of the Arc public chain mainnet on September 16, could all become future growth drivers. Additionally, Bernstein noted that Circle has raised its guidance for other revenues and profit margins after deducting distribution costs for 2026, expecting to confirm approximately $180 million in Arc token presale revenue.Analysts believe that future staking yields, gas fees, and ecosystem partnership revenues from Arc have not been fully reflected in current valuation expectations. As of the end of Q2, the circulating supply of USDC was $73.3 billion, a decrease of 5% from the previous quarter but an increase of 19% year-over-year. Bernstein believes that Circle is shifting from a purely crypto trading infrastructure to payments, real-world asset (RWA) tokenization, and broader financial infrastructure, which will drive USDC into the next phase of growth. Circle's stock closed at $63.28 on Wednesday, and Bernstein's target price of $140 implies a potential upside of about 121%.

The msUSD of MetronomeDAO once deviated from its peg by 11% due to insufficient collateral issues in the synthetic asset module

According to Blockaid monitoring, the trading price of MetronomeDAO's Synth USD (msUSD) on Ethereum, Base, and Optimism once dropped about 11% below the pegged value. Subsequently, MetronomeDAO released a post-mortem report stating that its synthetic asset swap module had insufficient collateral issues, resulting in a lack of adequate asset backing for approximately 6,367 msETH and 4.57 million msUSD, with the impact primarily concentrated on that module.The report pointed out that the problem stemmed from delays in the Chainlink price oracle during swap execution, and Metronome's fee design failed to adequately account for this variable, particularly on the Base chain where the situation was more severe. The team has deployed over $34 million in defensive positions and about $6.5 million in "last exit" liquidity, which could be used to repurchase and destroy sufficient assets to eliminate the gap if the peg deviates by about 30%. The team has increased the transaction fees for all synthetic trading pairs and upgraded the protocol to support a directionally isolated fee mechanism. Priority will be given to ensuring the treasury repurchases and destroys synthetic assets to restore 100% adequate collateral, while not affecting the rights of MET token holders, and the MET repurchase and distribution plan will proceed as usual.
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