Citi's Strategic Case for Circle Financial (CRCL) as the Undervalued Crypto Play in a Volatile Market

In a crypto market battered by volatility and shifting regulatory winds, Citi's unwavering $243 price target for Circle Financial (CRCL) stands out as a bold bet on the future of stablecoins. While peers like Gemini and MicroStrategy face downgraded expectations, Circle's USDC stablecoin continues to dominate a rapidly expanding sector, backed by institutional adoption and a wave of regulatory clarity. This analysis unpacks why Citi sees CRCL as a value play with asymmetric upside in a landscape where most crypto stocks are struggling to hold their ground.

The Case for Circle: Stablecoin Dominance and Regulatory Tailwinds

Circle's USDC stablecoin has cemented its position as the market leader, commanding a 29% share of the stablecoin market as of September 2025, with a circulation of $73.7 billion-a 108% year-over-year increase. This growth is not just a function of market share but a reflection of strategic positioning. USDC's adoption in payments, DeFi, and capital markets has been accelerated by partnerships with major financial institutions and platforms, creating a flywheel effect.

The regulatory environment has also shifted dramatically in Circle's favor. The U.S. passed the GENIUS Act in July 2025, establishing a federal framework for stablecoins that addresses long-standing uncertainties. Globally, the EU's MiCA rollout and regulatory advancements in Hong Kong, Japan, Singapore, and the UAE have further normalized stablecoin usage, attracting institutional capital. These developments align with Citi's thesis that stablecoins will reach a $1.6–$3.7 trillion market cap by 2030, a projection that underpins the bank's bullish stance on CRCL.

Contrasting Peers: Gemini's Struggles and MicroStrategy's Revisions

While Circle benefits from regulatory clarity, its peers are grappling with headwinds. Citi recently cut Gemini's price target to $13 from $16, citing intensifying competition and profitability challenges. Despite a 52% revenue jump in Q3 2025, Gemini reported a $159.5 million net loss, with shares hitting an all-time low of $15.80. The company's struggles highlight the difficulty of monetizing crypto infrastructure in a market where user growth doesn't always translate to profit.

MicroStrategy, now rebranded as Strategy, offers another cautionary tale. The company slashed its 2025 Bitcoin yield target from 30% to 22%–26% and reduced its BTC gain target from $20 billion to $8.4–$12.8 billion, reflecting Bitcoin's price drop from $150,000 to $80,660. While Strategy continues to accumulate Bitcoin (now holding 650,000 BTC), its pivot to a stablecoin-issuing model remains speculative and unproven. Citi's trimmed price targets for such high-risk plays underscore the sector's bifurcation: Circle's stablecoin-driven model is seen as more resilient than speculative crypto bets.

Value Investing in a Crypto Winter

Citi's $243 price target for CRCL-over 200% above its current $83.60 valuation-reflects a value investor's lens. Circle's financials tell a story of stability: its revenue from interest income on U.S. Treasuries and its dominant market position create a moat that rivals lack. The company's recent IPO, which raised $1.1 billion, further signals confidence in its ability to scale.

In contrast, value investors are wary of companies like Gemini, which burn cash despite revenue growth, and Strategy, which relies on volatile Bitcoin prices for its yield targets. Circle's regulatory compliance and institutional partnerships-such as rumored collaborations with Apple and Google-position it to capture mainstream finance's next wave, a sector where stablecoins are increasingly seen as infrastructure rather than speculation.

The Long Game: Why Citi's Bet Makes Sense

Citi's optimism isn't just about short-term gains. The bank's analysts, led by Peter Christiansen, view CRCL as a "top pick" in a sector where most players are overhyped. With stablecoins projected to underpin global payments, DeFi, and even central bank digital currencies (CBDCs), USDC's role as a bridge between traditional and digital finance is critical.

For investors, the key takeaway is clear: in a market where volatility is the norm, Circle's regulatory alignment, institutional adoption, and market dominance create a compelling case for long-term value. While peers like Gemini and Strategy chase speculative narratives, CRCL is building the rails for a stablecoin-driven future-one that Citi is betting will deliver outsized returns.