JPMorgan Chase at $120, Morgan Stanley at $38, Wall Street's valuation of Circle has been torn apart JPMorgan lowered its target price for CRCL from $155 to $120 on July 16th, but still maintained a positive rating. Morgan Stanley cut its target price directly from $106 to $38 on August 3, and downgraded its rating from neutral to low allocation. The two reports are separated by nearly three weeks and are not based on identical data. However, based on the price of approximately $60 for CRCL at the time, one side believes that there is still nearly double the upward potential, while the other side believes that there will be a decline of nearly 37%. In fact, there is not much disagreement between the two institutions regarding Circle's current issues. The vast majority of Circle's income still comes from interest generated from USDC reserves, which are highly sensitive to USDC liquidity and short-term US dollar interest rates. The Federal Reserve's interest rate cut will lower reserve yields, and channels such as Coinbase and Binance are taking away more and more revenue. Payment, settlement, and network services have not yet generated enough revenue. Circle must gradually shift from relying on users holding USDC to relying on USDC being used to make money, so both institutions have lowered their target prices and acknowledged that profit margins and growth are under pressure. JPMorgan Chase believes that these pressures will not undermine Circle's long-term story. The stablecoin market may become like a credit card network in the future, where the larger the scale, the more willing merchants, financial institutions, and users are to connect, ultimately concentrating in the hands of a few top issuers. Circle already has a first mover advantage in regulatory compliance, USDC market share, and Coinbase distribution channels. As regulatory rules gradually become clearer, banks, payment companies, and large enterprises will be more willing to use USDC. In addition, with the Arc blockchain and Circle Payments Network, Circle has the opportunity to upgrade from a stablecoin issuer to a complete payment and settlement infrastructure, and $120 corresponds to this long-term growth logic. The data seen by Morgan Stanley is much more pessimistic. USDC has shown little growth since the third quarter of 2025, therefore the liquidity forecast for 2027 and 2028 has been lowered by approximately 33% and 44% respectively. It is also believed that the management's proposed long-term compound growth target of approximately 40% lacks a realistic basis. Although the on chain trading volume of stablecoins is still good, a larger amount comes from exchanges, market makers, wallet transfers, and on chain fund allocation. However, the proportion of payment applications that are truly used for goods, services, and cross-border payments is still very low. These transactions can increase the transfer scale, but they hardly bring payment fees to Circle. (This is also one of the reasons why Circle wants to create its own chain, although I think it is wrong, just my personal opinion) Both sides have opposite judgments on regulation. JPMorgan Chase believes that clear rules will amplify Circle's compliance advantage, while Morgan Stanley believes that banks, Visa, Stripe, and large financial institutions will also find it easier to enter the stablecoin market. After compliance, Circle will face competition from tokenized bank deposits, tokenized money market funds, and other stablecoins, while Coinbase, exchanges, and payment platforms will still truly control users and traffic. The continued growth of the stablecoin industry does not mean that the profits generated by growth will remain in Circle. So both institutions have seen Circle's issues, and the difference lies in whether these issues are short-term costs in the expansion phase or structural weaknesses in the business model. JPMorgan Chase gave Circle a valuation for a future global stablecoin payment network, while Morgan Stanley gave Circle a valuation for a stablecoin issuer that is highly dependent on reserve interest rates, channel costs continue to rise, and USDC growth is starting to slow down. The following is my own opinion, which may not be correct. Firstly, both JPMorgan Chase and Morgan Stanley have lowered the market value of CRCL, with one lowering it from $155 to $120, and believing that CRCL will face pressure in the short term but may have a place in the long term. Morgan Stanley, on the other hand, has lowered it from $106 to $38, not only believing that CRCL will face pressure in the short term but also not optimistic about its performance in the long term. Many friends know that I have posted a lot of Circle review articles. Although I have not shorted, I am not very optimistic about CRCL. The main reason is that, like the two companies, Circle's profit is too single at present, and the so-called AI payment cannot form a scale at present. Moreover, although Circle has obtained a banking license, there are too few things it can do. Now it can only manage itself and save on custody fees. Even if it opens up to help other institutions manage, it does not fundamentally help with profitability. What Circle needs most now is whether there is a chance to charge some transaction fees while increasing the usage rate of USDC. So I think Circle needs to urgently launch its own public chain, which can solve the payment problem and charge some fees through each transaction. However, in reality, this means that it needs the support of exchanges, DEX and Perp. The former prefers their own channels, while the latter have their own public chains. The significance of building a chain now is really not significant. If Tether wanted to make a public chain, it may have done so a long time ago. What needs to be considered is why Tether doesn't do it. Of course, some people may say that just because Tether doesn't do it doesn't mean Circle can't do it. Of course, Circle can do it, but can the ultimate goal be achieved by making a public chain. It's better for Circle to run its own exchange. @Gate Crypto、 US stocks, Hong Kong stocks, South Korean stocks, gold CFD、 Predicting one-stop trading in the market