Circle Internet Group (CRCL): A 60% Discount Put Option Play Amid Regulatory Tailwinds and Profit-Taking

As Circle Internet Group (CRCL) navigates a volatile trading environment—marked by a 10.79% drop on June 19 to $218.30 amid profit-taking—the company's role as a leader in the $60 billion stablecoin market presents a rare opportunity for investors to lock in asymmetric risk-reward via options trading. With regulatory clarity on the horizon and strategic partnerships fueling long-term growth, selling put options at a 60% discount to current prices could offer a high-probability entry point, even as near-term valuation concerns linger.

The Case for Circle's Long-Term Value

Circle's USDC stablecoin, backed by the recently passed GENIUS Act, is a cornerstone of its value. The legislation establishes a clear regulatory framework for stablecoins, reducing the risk of overregulation and positioning USDC as a trusted tool for institutional and retail users. This tailwind is critical: stablecoins now account for 85% of Circle's revenue, and partnerships like its deal with Fiserv to integrate USDC into payment systems signal expanding adoption.

Financial metrics also support the bullish case:
- Year-to-date revenue surged 187.86%, with a $64.79 million net income in the latest quarter (up 33% sequentially).
- Analysts project a $220.00 12-month price target, just 0.46% above current levels, reflecting confidence in its growth trajectory.

Why Selling Puts at 60% Below Current Prices Makes Sense

The strategy: Sell out-of-the-money (OTM) put options with a strike price of $87.32 (60% below $218.30). Here's why this offers a compelling risk-reward profile:

1. Safety Margin:
2. The $87.32 strike is $21.32 above Circle's all-time low of $64 (June 5, 2025), creating a buffer against catastrophic downside.

3. Even in a bearish scenario, a collapse to $87 would require a 60% decline from current prices, an eventuality that seems improbable given USDC's network effects and regulatory tailwinds.

4. Premium Income:

5. Selling puts at this strike would likely generate a premium of ~$10–$15 per contract, depending on volatility. For a $218 stock, this represents 5–7% of the strike price collected upfront, with profits locked in if the stock stays above $87.

6. Upside Capture:

7. If CRCL rebounds toward its all-time high of $248.88, the put seller benefits indirectly as the shares rise. Even if assigned shares at $87, the position would be 27% below the current price, offering a robust entry.

Mitigating Near-Term Risks

Critics may argue that the stock's 216% YTD surge has created overvaluation concerns. However, several factors justify the bullish put strategy:
- Cathie Wood's Pullback: ARK Invest's recent trimming of CRCL holdings—a near-term headwind—could create a buying opportunity. Wood's moves often signal short-term sentiment shifts rather than fundamental weakness.
- Technical Reversal Potential: The stock's 29.63% weekly gain suggests a correction is already underway. A rebound toward the $240–$250 range (near its June 20 high) is plausible as regulatory clarity and earnings (due Sept. 3, 2025) reassert themselves.

The Trade's Execution

• Strike: $87.32 (60% below $218.30).
• Expiration: Choose a 3–6 month period to align with the Sept. 3 earnings catalyst.
• Position Sizing: Use 10% of capital per contract to maintain risk discipline.

Conclusion: A Rare Asymmetric Opportunity

Circle's leadership in stablecoins and the GENIUS Act's regulatory seal of approval form a sturdy foundation for long-term growth. Selling puts at a 60% discount offers a high-probability trade with limited downside risk and meaningful upside potential. While near-term volatility remains a concern, the strategy's safety margin and alignment with Circle's structural tailwinds make it a compelling play for investors willing to think long-term.

Investment Thesis: Sell CRCL puts at $87.32 to capitalize on a stock that's fundamentally undervalued relative to its $18.7 billion market cap and the $60 billion stablecoin market it dominates. Even in a worst-case scenario, the downside is capped at a historically low level, while the upside is open-ended as USDC adoption accelerates.

Final Note: Monitor liquidity and volatility when executing this strategy, as options on high-beta stocks like CRCL can experience wide bid-ask spreads. Always pair this trade with a risk management plan.