Bernstein sees new USDC growth cycle, sets $140 target
Bernstein sees a new USDC growth cycle after the stablecoin's supply jumped roughly $2 billion in seven days, reversing six months of stagnation. The firm maintained an Outperform rating on Circle and a $140 price target, implying about 60% upside as transaction activity and regulatory clarity improve.
In a research note published Monday, Bernstein analysts said USDC is showing signs of what they called "digital dollar reflation." Circle shares have already risen roughly 40% over the past month, but the Wall Street firm argues the next 12 months could deliver another leg higher for the stablecoin issuer.
Key Takeaways
- USDC supply grew by about $2 billion in seven days after six months of flat or declining growth.
- Bernstein kept an Outperform rating on Circle (CRCL) with a $140 price target, implying roughly 60% upside.
- USDC's share of adjusted stablecoin transaction volume rose from about 40% in 2025 to more than 60% in 2026.
- Bernstein cited crypto market momentum, U.S. regulatory clarity, tokenized capital markets, payments adoption, and early AI-agent use as growth drivers.
- Circle reported $701 million in revenue and $48 million in net income in its most recent quarter, both up year over year.
Why is Bernstein bullish on Circle and USDC?
Bernstein's Monday note frames the recent supply rebound as the start of a broader stablecoin expansion cycle. The firm maintained its Outperform call and $140 target on Circle, which would mark roughly 60% upside from current levels.
Circle went public in June 2025 at $31 per share and raised about $1.1 billion. After a post-IPO surge, the stock fell back toward its offering price by November 2025 as a broader crypto downturn weighed on sector-exposed public companies. The recent share rally and USDC supply jump suggest investors are reassessing that downturn narrative.
What is driving USDC's supply rebound?
Bernstein pointed to several factors that could fuel the next phase of stablecoin growth. Renewed momentum in crypto markets, greater regulatory clarity in the United States, tokenized capital markets, and wider stablecoin adoption for payments all featured in the firm's outlook.
The analysts also flagged early signs of stablecoins being used for payments made by artificial intelligence agents. Stablecoin transaction volume has grown significantly in 2026, according to Bernstein's data, adding context to the supply increase.
Washington policy debates remain active. Coinbase-affiliated advocacy group Stand With Crypto endorsed 32 House candidates on Monday ahead of the 2026 midterms, part of its push to elect a pro-crypto Congress. Legislation such as the GENIUS Act and the pending CLARITY Act could shape the regulatory environment Bernstein expects to support USDC.
How has USDC performed against Tether?
USDC remains the second-largest dollar-backed stablecoin by market capitalization, well behind Tether's USDt (USDT). By transaction activity, however, the picture looks different.
Bernstein said USDC's share of adjusted stablecoin transaction volume rose from roughly 40% in 2025 to more than 60% so far in 2026, overtaking USDt on that measure. That shift helps explain why Wall Street is tying Circle's stock outlook more closely to on-chain usage than to market-cap rank alone.
What should investors watch next?
Circle's financial results offer a baseline for tracking the thesis. The company reported $701 million in revenue and $48 million in net income in its most recent quarter, both higher than a year earlier.
Whether USDC supply keeps expanding after this seven-day surge will test Bernstein's "digital dollar reflation" call. For broader crypto market context, see our Fintech & Crypto Alerts hub. Full analyst details are in the Cointelegraph report on Bernstein's Circle target.