Forbes： Circle Stock To $500?

We discussed Circle Internet Group Inc. (NYSE: CRCL) stock’s potential to reach $300 less than two weeks ago. Over the following week, the stock surged from $120 levels to around $240 – and sits at $225 currently. Is it possible for it to rise to $500 levels from this point?

 

Absolutely — we will elaborate on the upside case below, particularly as we gain more clarity concerning Circle's non-stablecoin revenue potential. However, given the rapid increase, it’s also crucial to warn investors: while the upside remains significant, downside risks also exist from macroeconomic changes, competitive pressures, and adoption trends that may not accelerate as anticipated.

Revisiting the $300 Case — and Extending It

Our previous analysis suggested that Circle could reach $300 per share based on three key factors:

1. Growth in USDC circulation, increasing yield income on reserves
2. Margin expansion as the platform develops
3. Recurring revenues from enterprise APIs

These factors still hold true — and may be gaining momentum. However, given that the stock has doubled in just days, investors must consider: What could support another doubling from this level?

What Could Justify a $500 Valuation?

At $500 per share, Circle's market capitalization would be approximately $120 billion. What could warrant such a figure?

1. USDC Reserve Revenue Scaling Even Further

Circle currently benefits from an interest rate environment exceeding 5% and about ~$60 billion in USDC circulation. If this circulation expands to $250 billion in the next 3–4 years, and rates remain above 3%, gross yield revenue could attain $8 billion annually. Even after accounting for partner revenue sharing (notably with Coinbase), Circle might net $4-4.5 billion, nearly tripling current levels.

This alone could support earnings of $2 per share if the net margins close to 10% reported in recent quarters are maintained — however, that would likely undervalue the potential, as with increased scale, an enhancement in net margins may occur, potentially reaching a 20% net margin reported in FY2023. In this scenario, we would be looking at an EPS of $4 per share, which, however, would not lead us to the $500 valuation.

2. Infrastructure Revenue Becomes a Dominant Driver

The larger narrative revolves around non-stablecoin revenue stemming from Circle’s ambition to serve as the financial backbone for blockchain-based payment applications, which entails:

• Programmable payment APIs tailored for enterprises
• Smart contract wallets and custody SDKs
• On-chain FX, treasury, and compliance rails

Circle is effectively positioning itself as the “Stripe for digital dollars” — providing developer-grade infrastructure to facilitate businesses in integrating stablecoin payments, cross-border transactions, and on-chain financial operations into their foundational systems.

How significant could this become? If Circle secures even 15,000–20,000 mid-sized and large clients across fintech, tokenized asset platforms, and embedded finance applications, it could realistically achieve $3-3.5 billion in recurring infrastructure revenue.

This isn’t far-fetched. For context:

• Stripe serves millions of businesses worldwide and generates billions in revenue from its enterprise clients.
• Adyen collaborates with around 5,000 enterprise customers and earns over $1.5 billion annually, with an average client expenditure surpassing $300,000.
• Plaid, which specializes in data and account connectivity, serves over 12,000 financial applications.

Given the increasing demand for regulated, on-chain infrastructure — particularly among financial institutions and fintech companies — Circle possesses a viable path to capturing a significant share of the global enterprise addressable market. At $200K per year per client (considerably lower than Adyen), these services could yield software-like recurring revenue with higher profit margins compared to yield income and long-term operating leverage.

This, combined with the expected reserve yield, could enable Circle to achieve $8 billion in total revenue, and net income close to $3 billion (~$2 billion from infrastructure operations). With 250 million shares, this would suggest an EPS of $12 — and at a 42x P/E ratio (reasonable for high-margin fintech infrastructure), a $500 stock value begins to seem justifiable.

But What Could Go Wrong?

While the $500 scenario is enticing, investors must remain aware of potential downsides too. Here is another analysis: Circle Stock At 60% Safety?

 

• Interest Rates Drop Faster Than Expected

A decline in rates would negatively impact Circle's core yield operations. A reduction from 5% to 2% could halve reserve income unless countered by significant USDC growth.

• Revenue Sharing with Coinbase Narrows Margins

The partnership with Coinbase contributes significantly to Circle's cost structure. Any renegotiation, friction, or alteration in economic terms could substantially impact net margins.

• Adoption of APIs Slower Than Expected

Circle's infrastructure business is still in its early stages. It requires not only product development but also trust, integration support, and client onboarding. If enterprises do not scale rapidly, the upside from software revenues could be delayed or limited.

Although clarity is improving, regulation in blockchain remains inconsistent. A hostile U.S. government or varying treatment around the globe could hinder Circle's capability to expand internationally.

Conclusion: $500 is a Stretch, But Not Impossible

The pace of Circle's recent surge may require a pause. However, fundamentally, the company is transitioning from a stablecoin issuer to an infrastructure provider for online finance. In the short term, we should anticipate volatility, yet the revenue trajectory indicates that Circle has the essential components to reach $500.