Circle (CRCL) stock rebounded 5% after plunging 17% on Wednesday as investors consider whether the new Open USD Stablecoin Consortium, backed by Stripe, Mastercard, Coinbase and BlackRock, poses a lasting threat to the world. $USDC Publisher.
Global brokerage firm Jefferies is not convinced that the latest sell-off is fully priced in, arguing that Circle faces increasing competitive pressure as banks, payments companies and fintech companies continue to issue their own stablecoins.
“Buy the dip? We don’t buy,” the firm’s analyst team said in a note to clients.
“CRCL headwinds are unlikely to abate,” analysts said, warning that competition could be squeezed. $USDCsupply growth and market share.
The authors argued that Circle, which holds roughly 25% of the $300 billion stablecoin market, is moving into a more competitive phase. meanwhile $USDC Benefiting from an early lead after launching in 2018, Jeffries said the new entrant now has what Circle lacked in its early days: a large, built-in distribution network.
The launch of Open USD, backed by over 140 companies including Stripe, Coinbase, Visa, Mastercard, and BlackRock, is a point of change. The consortium plans to share preliminary revenue with participating companies, potentially making the platform more attractive to payment providers and fintechs.
