Circle Internet Group (NYSE:CRCL) received a bullish reiteration from Bernstein, which maintained its Outperform rating and $190 price target, implying 44% upside from current levels.

Why Bernstein Remains Bullish

In a Tuesday note, Bernstein cited strong USDC (CRYPTO: USDC) growth and the $222 million ARC token presale helping offset pressure from declining interest income.

Analysts said Circle's reserve income declined 11% quarter-over-quarter due to lower interest rates, contributing to first-quarter revenue of $694 million, which missed estimates by about 4%.

However, adjusted EBITDA reached $151 million, topping consensus estimates by roughly 10%, supported by stable operating costs and resilient USDC growth.

Bernstein said the recent ARC token presale at a $3 billion fully diluted valuation provides a near-term revenue cushion as interest-rate-related headwinds pressure reserve income, The Block reported.

Expanding USDC Supply

USDC supply climbed to $77 billion in the first quarter, rising 28% year-over-year and 2% quarter-over-quarter, according to the note.

Bernstein highlighted that Circle's on-platform USDC balances grew to $13.7 billion, representing 18% of total supply, even as the broader crypto market dropped roughly 40% from October 2025 highs.

The rating firm predicts around 40% CAGR for both USDC supply and non-float revenue.

AI Payments Narrative Gains Momentum

Bernstein also highlighted the upcoming mainnet launch of Arc, Circle's Layer-1 blockchain network.

During its testnet phase, Arc processed more than 244 million cumulative transactions and supported 1.6 million unique wallets.

The analysts specifically pointed to Circle's "agentic" AI payments infrastructure, including the x402 micropayments standard, as a potential long-term growth driver for USDC adoption in machine-to-machine payments.

According to Bernstein, USDC currently represents more than 99% of all x402-based agentic payment settlements globally.

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