Bernstein has reaffirmed its Outperform rating on Circle Internet Group with a $190 price target, implying a potential 203% upside, even after the stock dropped 17.5% following the launch of a rival stablecoin, Open USD.
The firm also maintained an Outperform rating on Coinbase with a $330 target, pointing to resilient long-term fundamentals despite short-term market pressure.
Open USD triggers market reaction
Circle’s decline came after the debut of Open USD (OUSD), a stablecoin backed by more than 140 companies, including Visa, Stripe, Mastercard, BlackRock, and Coinbase. The project is structured under the Open Standard organization and governed by a consortium rather than a single issuer.
OUSD introduces a different economic model, offering free issuance and redemption while distributing reserve earnings across network participants instead of concentrating profits within one entity.
Stripe confirmed that OUSD will become the default stablecoin on its platform after a planned full rollout in the second half of 2026. Zach Abrams, head of Stripe’s stablecoin unit Bridge, will lead the initiative as founding chief executive.
Circle maintains strong position despite competition
Bernstein said the emergence of OUSD strengthens the broader stablecoin market but does not pose an immediate threat to Circle. USDC currently accounts for about 28% of dollar-pegged stablecoin supply and continues to expand rapidly in usage.
Transaction volume reached $5.3 trillion in the first half of 2026, marking a roughly 140% increase compared with the full year 2025. USDC’s share of total stablecoin transaction activity has also climbed from around 40% last year to nearly 60% this year, reflecting deeper adoption across payments and trading platforms.
Circle’s growth has been driven by partnerships and integrations, a strategy similar to Tether’s earlier expansion. While Coinbase remains a key partner holding roughly a quarter of USDC balances, Circle has broadened its network through collaborations with platforms such as Hyperliquid and Polymarket, alongside launching its Arc blockchain with support from over 100 partners.
Coinbase role draws attention
Coinbase’s involvement in the OUSD consortium has raised questions given its existing relationship with Circle. The exchange earns about half of USDC reserve income through its partnership, accounting for nearly one-fifth of its total revenue.
Bernstein said Coinbase’s participation is likely aimed at expanding stablecoin utility and accelerating on-chain payments rather than shifting away from USDC. The report noted that both Coinbase and Circle have historically shared reserve income with partners to strengthen liquidity and network effects.
Analysts see limited near-term threat
Separate analysis from William Blair also supported Circle’s outlook, describing OUSD as a project still seeking clear market traction. The firm suggested the recent sell-off reflects an overreaction rather than a structural shift in the competitive landscape.
Deepen your understanding of stablecoins and regulation with this concise guide: read more here now.
Disclaimer: The content on this page is provided for general informational purposes only and does not represent the views or financial advice of Toobit. We make no guarantees regarding the accuracy or completeness of this information and shall not be held liable for any errors, omissions, or outcomes resulting from its use. Investing in digital assets involves risk; users should independently evaluate their financial situation and the risks involved. For further details, please consult our Terms of Service and Risk Disclosure.
