Circle's $1.88B Volume Plummets to 35th Amid Regulatory and Profit-Sharing Turbulence

On August 4, 2025, Circle (CRCL) closed at a 1.95% decline, with a trading volume of $1.88 billion, ranking 35th in market turnover. The stock faced renewed pressure amid regulatory challenges and evolving profit-sharing structures.

The selloff intensified as the GENIUS Act imposed stricter reserve requirements on stablecoins, limiting Circle’s ability to generate yield from its reserves. Management’s disclosure of expanded profit-sharing agreements with partners further exacerbated concerns about margin compression, triggering heightened volatility in the options market. Implied volatility surged to 89.79%, reflecting heightened uncertainty ahead of the August 12 earnings report, where analysts anticipate a loss per share of $1.29.

Technical indicators underscored bearish momentum, with the RSI dipping to 37.11 (oversold) and the 30-day moving average at $202.23, below which the stock currently trades. Key support levels at $166.37 and $160.04 remain critical for near-term stability. Options activity highlighted investor positioning: the $150 put (CRCL20250808P150) emerged as a high-liquidity hedge, while the $160 call (CRCL20250808C160) offered exposure to potential rebounds, albeit with significant time decay risks.

Backtesting of CRCL’s intraday performance following a 7% decline showed mixed outcomes. Short-term recovery odds stood at 52.47% over one day, 52.83% over ten days, and 48.99% over 30 days. These figures highlight the stock’s susceptibility to rapid reversals but also the challenges of sustaining gains post-volatile moves. Investors are advised to monitor the $166.37 support level and the August 12 earnings report for directional clarity, with liquidity concentration in high-volume stocks like CRCL underscoring the potential for sharp price swings in volatile markets.