Analysts at Bernstein predict that Circle’s USDC stablecoin will experience substantial growth over the next two years, with supply expected to surge from $76 billion today to $220 billion by the end of 2027. This increase would position USDC to capture roughly one-third of the global stablecoin market, up from its current 29% share. The firm cited Circle’s regulatory compliance, robust liquidity, and strategic partnerships with major exchanges such as Coinbase and Binance as key factors likely to fuel its growth.

USDC Gains Ground Against Competitors

While Tether’s USDT remains the dominant stablecoin with a market cap exceeding $180 billion—representing 62% of the $290 billion stablecoin sector—USDC has steadily increased its market presence, gaining 6% over the past 18 months. Other stablecoins, including USDe, Dai, and USDS, trail behind with market caps of $12.6 billion, $5 billion, and $4.8 billion, respectively. Analysts suggest that USDC’s combination of regulatory clarity and strong exchange integrations provides a competitive edge that is challenging for other issuers to match.

Regulatory Advantage from the GENIUS Act

Circle’s position has been further strengthened by the passage of the GENIUS Act in July, which establishes a federal framework for “payment stablecoins.” The legislation restricts foreign issuers, recognizes U.S.-based tokens as digital cash rather than securities, and sets high compliance standards. Bernstein noted that Circle already meets these criteria with full backing of cash and U.S. Treasurys, daily reserve disclosures, and independent attestations. These regulatory safeguards are expected to attract banks, payment providers, and institutions seeking compliant infrastructure, providing USDC with a clear path to dominate the U.S. market.

Massive Transaction Volume and Liquidity Advantage

The research firm highlighted that Circle’s USDC ecosystem already boasts significant liquidity and adoption. In the first half of 2025 alone, USDC transactions processed by Circle reached approximately $3 trillion, a 120% increase from 2024. Integrations across 28 blockchains, coupled with deep distribution through major exchanges, have created a liquidity moat that will be difficult for new entrants to overcome. Competitors such as PayPal’s PYUSD and Tether’s U.S. subsidiary USAT are expected to face “cold-start” challenges in liquidity and exchange coverage.

Expansion Across Payment Networks and Use Cases

Bernstein forecasts that the overall stablecoin market will expand to $670 billion by 2027, driven by growing crypto capital markets and emerging applications such as cross-border payments and remittances. USDC is expected to capture a sizable portion of this growth, with projected supply reaching $220 billion. New integrations with platforms including Fiserv, FIS, Corpay, and Shopify are expected to further strengthen USDC’s adoption for payments and merchant use, cementing its role as a digital dollar for online and offline transactions.

Financial Model and Revenue Growth

Circle’s financial performance is heavily influenced by float income derived from its reserves. While potential rate cuts could reduce interest earnings, Bernstein analysts project that the expansion of USDC supply, combined with revenue from cross-chain transfer fees, payment networks, and operating leverage, will offset these effects. Non-interest income has already grown from 1% of total revenue in 2024 to 4% in the first half of 2025. Analysts forecast that Circle’s revenue will grow at a 47% compound annual rate through 2027, supported by a 71% compound annual growth rate in USDC supply.

Long-Term Outlook for Stablecoins and USDC

Looking beyond 2027, Bernstein expects stablecoins to reshape the financial landscape, projecting total stablecoin supply to reach $4 trillion by 2035. USDC is expected to maintain roughly 30% of this market, benefiting from Circle’s ongoing development of infrastructure such as the Circle Payments Network and its purpose-built blockchain, Arc. Analysts emphasized that digital dollars are poised to become the “money-rail of the internet,” with Circle positioned as a front-runner due to its head start, regulatory compliance, and extensive partnerships.

Analyst Ratings and Price Target

Bernstein reiterated an outperform rating for Circle’s stock, setting a price target of $230, representing a potential 67% upside from the Monday closing price of $137.47. Analysts believe that Circle’s strategic positioning in both the regulatory and payments ecosystem, combined with USDC’s expanding supply and adoption, will drive long-term growth for the company and solidify its dominance in the stablecoin market.

Conclusion

Circle’s USDC is on track to become one of the largest and most widely used stablecoins globally, benefiting from a compliance-first model, broad exchange integrations, and strong institutional partnerships. With Bernstein forecasting a tripling of USDC supply by 2027, the stablecoin is expected to capture a substantial share of the growing stablecoin market, setting the stage for a transformative impact on digital payments, cross-border transactions, and crypto capital markets in the years ahead.