Summary Circle Internet Group (CRCL) is well-positioned for growth, driven by strategic partnerships with Kraken and Deutsche Börse Group to expand USDC and EURC adoption. The GENIUS Act provides regulatory clarity, fueling stablecoin adoption and supporting a projected 60% CAGR in USDC circulation, with Circle's revenue surging 53% YoY. CRCL is currently undervalued with a P/S ratio of 4.82x versus peers, and robust revenue growth justifies a price target of $247.67, implying 66.5% upside. Risks include dependence on USDC transaction volumes and execution challenges, but regulatory tailwinds and new partnerships reinforce a bullish outlook on CRCL. Introduction & Investment Thesis I am bullish on Circle Internet Group Inc.( CRCL ) driven by the partnerships with Kraken and Deutsche Börse Group , both of which are advancing the adoption of USDC and EURC. The Kraken and Circle partnership is specifically facilitating global access and utility of USDC and EURC, with the Kraken platform offering an onchain financial application. The Deutsche Börse Group’s partnership with Circle will accelerate the adoption of stablecoins in Europe through the Deutsche Börse Group infrastructure by delivering solutions to market participants. Following the passage of the GENIUS Act by US President Donald Trump, this statute regulates stablecoins in the US as a form of digital currency, which has seen a 20% increase in usage since last year, 2024. As such, the transaction volume of stablecoins has surpassed both Visa and Mastercard transactions in 2024, indicating that regulatory guidelines are poised to spark confidence and reduce risks, thereby elevating adoption. So far, the collective market capitalization of stablecoins in circulation exceeds $208 billion , and all of these are approximately 99% pegged to the US dollar. WEF Given that the two partnerships are at an early stage, I believe the confidence provided by the GENIUS Act is a solid foundation for a growth outlook. Moreover, this explains why Circle approximates a median CAGR of 60% multiyear growth forecast after recording 90% YoY growth in USDC circulation at $61.3 billion. Since the end of the second quarter of 2025, the company has recorded a 6.4% growth, indicating that partnerships are accelerating the adoption, resulting in more revenue for the company. In the explanations below, I will delve further into why I believe these partnerships are the route to achieving a 60% CAGR following a regulatory tailwind. Company Brief Circle Internet Group, Inc. operates a platform and network infrastructure for stablecoin and blockchain applications. It offers a suite of stablecoins, such as the US dollar-dominated stablecoin, along with services for liquidity, payments, and developer integration. This company was incorporated in 2013 and is headquartered in New York, New York. Weighing The Partnerships Before discussing the impact of partnerships on Circle’s growth, I will first introduce my thoughts on the process of the stablecoin market. To begin with, the GENIUS Act is an early enabler of stablecoin adoption, as it provides the regulatory certainty it brings. Before the GENIUS Act was assented into law, there was scepticism around the risks of stablecoins, which this act has addressed. With the GENIUS Act, stablecoin issuers are expected to provide monthly reserve disclosures, hold high-quality reserve assets, safeguard them with qualified custodians, and publish redemption policies. I am highlighting this analogy to bring you closer to my perspective on why I am considering Circle partnerships at this early stage as a solid foundation for further growth backed by a regulatory framework. I am examining stablecoin opportunism within a grounded legal framework that ensures users of stability and transparency through constant disclosures, thereby creating sustainability. Given this perspective, I will now move to my second analogy, which is the stablecoin market. In my earlier explanations, I indicated that stablecoin circulation is currently valued at above $208 billion. To add on this, the GENIUS Act is about to scale adoption further at a median CAGR of 45% to 2030 at a circulation volume of $3.7 trillion. Citibank Given that stablecoins have already gained popularity due to the perennial problems they address, such as speed, cost, transparency, and availability, this has increased domestic and international exchange. Therefore, the stablecoin has offered transformative capabilities that legacy payment systems have not solved. A good example of cost efficiency is that stablecoins offer instant settlement compared to legacy payments, which take 1-5 business days and incur a cost per transaction. In contrast, stablecoins provide a cost of less than $0.1. Compared to international wire, which costs around $15 to $50, and Automated Clearing House, which costs around $0.2 to $1.5, this shows the real benefits of why stablecoin circulation is gaining traction. Now, with the GENIUS Act, the barrier to stablecoin adoption has been broken, further opening up stablecoin adoption. Approximately 73% of people and organizations interested in using stablecoins cite regulatory uncertainty, while 38% cite the need for clarity in accounting and tax treatment, which is addressed under the GENIUS Act. EYParthenon In my view, this is where Circle Partnership’s angle comes from as a way of capturing more than 73% and 38% of interested users that the GENIUS Act has broken barriers for. By partnering with more stablecoin platforms, it can facilitate more transactions or circulation around these platforms. Now, the partnership with Deutsche Börse Group and Kraken provides the company with access to 50% of interested stablecoin users who were hindered by a lack of reliable banking partners, a major concern in Europe through Deutsche Börse Group. On the other hand, the Kraken partnership, which aims to scale global adoption, is exposed to 50% of the interested stablecoin users who are hindered by tax and accounting treatment as a major issue. Additionally, 11% of interested stablecoin users in Europe and 20% cite tax treatment and accounting as their major concerns, which is why they have not yet considered using stablecoin. With the GENIUS Act in place, I believe new partnerships will now widen stablecoin adoption, and Circle is now part of this access to bolster circulation around a CAGR of 60%. Financials and Valuation The sign of increasing circulation following the GENIUS Act, driven by the confidence in tax treatment and accounting, the requirement for a reliable banking partner, and regulatory certainty, is the 90% increase in USDC circulation. This has resulted in an overall total revenue of $658 million in the second quarter of 2025, representing a growth of 53% YoY. The company’s revenue is currently trailing at $2.12 billion, and by the end of 2025, the revenue is likely to surpass $2.63 billion, representing a 56.55% increase YoY. Notably, over the last five years the company’s top line has been in a solid upward momentum averaginga n annual growth rate of about 285.3%. This is an indication of the strong demand for its product which I believe will be sustained by the current partnerships. Stock Analysis The company achieved profitability in FY2023 and FY2024; however, in FY2025, it is running at a loss due to non-cash charges relating to the IPO. The net loss was primarily contributed by the IPO, which reached $482 million by the end of Q2’2025, and significantly impacted the company’s profitability, resulting in a trailing loss of $299.635 million. With that being said, Circle is in an ideal position to return to profitability, given that the partnerships are still in their early stage. The USDC circulation is expected to increase significantly at a CAGR of 60% multiyear median rate as explained earlier. The GENIUS Act provides a solid foundation that will guide this growth, given the large number of interested stablecoins that the regulatory uncertainty has hindered. In my previous explanations, I have indicated the growth optimism, which is a reason to be optimistic about Circle. Stock Analysis I will now conclude this part by valuing Circle using a P/S ratio metric compared to its peers, Atlassian Corporation (NASDAQ: TEAM ) and PTC Inc. (NASDAQ: PTC ). CRCL P/S ratio is 4.82x, which I consider an undervaluation considering TEAM’s P/S ratio of 7.54x and PTC’s P/S ratio of 9.06x. Seeking Alpha When I look at the expected revenue growth rates for these companies, CRCL has the highest at 55.9%, significantly above its peers affirming this stock is undervalued. YCharts Having said that, I will estimate my price target for this stock but I will begin by projecting its future performance. In my projections, I will assume a revenue growth rate of 50% in 2025 FY and 52% in 2026 FY which are close to the company's average revenue growth rate for the last two years which is 51.72%. In terms of profitability, I expect the company to make a net loss this year as explained in the financials but I believe they will turn profitable in 2026 in the region of 1% net margin. With these assumptions, I estimate a revenue of about $3.8 billion by 2026. Considering this company’s higher growth rate than its peers and its undervaluation, I expect a higher P/S above its peers. I am having a target P/S of 15x. Given these inputs, I estimate a price target of $247.67 which translates to an upside potential of 66.5%. FPP(Author) Investment Thesis Dependence on USDC – Circle relies on USDC transaction volume. If any crypto adoption slowdown occurs, it may risk hindering its future revenue progression. Execution risks – The new partnerships require flawless execution and integration along the regulatory framework across jurisdictions. This may require time, and in the event of a delay, it risks Circles failing to achieve the gains of this partnership expansion. Conclusion When I examine the partnerships Circle has entered into post-GENIUS Act, this is a testament that the company is rushing to position itself as the best channel offering stablecoin circulation. The partnership is part of scaling adoption as the GENIUS Act unlocks the regulatory hurdles that previously existed. This drives me to reiterate my bullish stance on Circle.
