Circle Internet Group (CRCL) shares fell Tuesday after Mizuho Securities downgraded the stock to Underperform from Neutral. Analysts slashed the price target to $50 from $85.
The downgrade follows the emergence of Open USD, a rival stablecoin backed by a consortium of over 140 partners. Mizuho warns that Open USD’s business model shares reserve income with distributors, whereas Circle currently retains the majority of yield from its USDC reserves.
This competitive structure could compress pricing and pressure Circle’s long-term profitability. Analysts believe these competitive risks now outweigh the benefits of a higher interest rate environment.