Bernstein sees 203% upside for Circle even as new stablecoin rival OUSD debuts

Bernstein reaffirmed its Outperform rating on Circle Internet Group and kept its $190 price target, implying 203% upside, a day after CRCL stock closed down 17.5% on the launch of Open USD, a stablecoin backed by more than 140 companies, including Visa, Stripe, Mastercard, BlackRock, and Coinbase.A…

According to a note on Wednesday, Bernstein also retained its Outperform rating and $330 price target on Coinbase.

What is Open USD

Open USD will be run by Open Standard, an independent company governed by a board of its own partners rather than by a single issuer.

Minting and redemption, two key ends of stablecoin infrastructure, are free with no issuance caps, and reserve earnings are shared across the partner network rather than retained by one company.

Zach Abrams, chief executive of Stripe's stablecoin unit Bridge, was named founding CEO of Open Standard. Stripe said OUSD will become the default stablecoin for businesses on its platform, with a full launch planned for the second half of 2026.

Bernstein's case for Circle

Bernstein argued that the scale of the OUSD coalition validates stablecoins as a category but doesn't immediately threaten Circle's position. Circle’s USDC holds about 28% of the dollar stablecoin monetary base, the firm said, but its transaction volume tells a different story.

USDC processed $5.3 trillion in the first half of 2026 alone, roughly 140% growth over 2025's full-year pace, with its share of transaction volume rising from about 40% in 2025 to about 60% so far in 2026, according to Bernstein's analysis of Visa onchain data.

Bernstein compared the dynamic to how Tether built USDT's dominance by anchoring liquidity to Bitfinex and then Binance's user base before scaling to $180 billion in supply.

Circle took a similar path through Coinbase, which accounts for about 25% of USDC held on-platform, and has since expanded liquidity through Hyperliquid and Polymarket. Circle's own Arc blockchain, Bernstein noted, launched with more than 100 partners spanning digital assets, payments, and financial services.

Circle CEO Jeremy Allaire made a similar network-effects argument in a lengthy post on X in response to investor questions, writing that stablecoin networks are winner-take-all businesses built over years of liquidity and regulatory work. Allaire was also skeptical of the consortium model itself, writing that the track record of similar multi-company products reaching scale "is absolutely dismal."

Tether CEO Paolo Ardoino took a lighter jab at the new entrant, writing on X: "Welcome OUSD. Player 2 has entered the game."

The Coinbase question

Bernstein flagged Coinbase's presence on the OUSD partner list as notable, given how much the exchange has riding on USDC.

Coinbase earns roughly 50% of USDC's reserve income under its distribution agreement with Circle, which accounts for close to 20% of Coinbase's total revenue.

In his post on Wednesday, Allaire noted that Circle's stablecoin partnership with Coinbase "remains as strong as ever."

Bernstein said it believes Coinbase's actual intent is to expand mainstream stablecoin adoption rather than shift away from USDC, citing prior arrangements in which Circle and Coinbase shared a majority of USDC reserve income with anchor partners like Binance and Hyperliquid to keep them on the network.

William Blair separately reiterated its own Outperform rating on Circle, calling OUSD "a solution searching for a problem."

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.