Circle stock targets 45% surge as USDC nears key $80 billion milestone

Circle stock price is in a strong bull run this month, reaching its highest level since November last year, and this trend may continue as the market capitalization of the USDC stablecoin nears an $80 billion milestone.

CRCL stock jumped to $122.55, up by 147% from its lowest point this year, with its market capitalization jumping to over $30 billion.

There are signs that Circle’s business is thriving as demand for its stablecoin jumps. The supply of all USD Coin (USDC) tokens has jumped to over $79.8 billion, a $10 billion increase from the lowest point last month.  

More data shows that USDC has become the most used stablecoin in the industry. Its volume jumped to nearly $6 trillion in the last 30 days, much higher than USDT’s $1.1 trillion.

Soaring USDC supply is important for Circle because of its business model. It makes most of its revenue by investing its USDC holdings into short-term government bonds, which are now yielding about 3.5%. 

Government bond yields will likely remain elevated for a while as the Federal Reserve is unlikely to cut interest rates several times this year because of the ongoing Iran war. This war will push inflation much higher than where they are today as energy and transport prices soar.

The most recent numbers showed that Circle’s business continued thriving in the last quarter of last year, with its revenue rising by 77% to $770 million and its EBITDA moving to $167 million.

In addition to this, Circle Payment Network is seeing more user adoption as it has gained 55 partners, and more are coming up. This solution has the ability to disrupt the Swift Network, which moves trillions of dollars annually. It leverages the USDC stablecoin to save money and ensure instant payouts.

Circle stock price prediction: Technical analysis 

The daily chart shows that the CRCL stock price has rebounded this month. It has already jumped above the 23.6%Fibonacci Retracement level, which is drawn by connecting its highest and lowest levels on record.

The stock has jumped above the 50-day Exponential Moving Average, while the Supertrend indicator has turned green. The Average Directional Index has moved to 40, a sign that the upward momentum is accelerating.

Therefore, the stock will likely continue rising as bulls target the 50% Fibonacci Retracement level at $174, which is about 45% above the current level.