Bernstein is sure that Circle can sustain growth and is not worried about Hyperliquid's stablecoin

According to CoinWorld, analysts at Bernstein reiterated their $230 target price for Circle stock (stock code CRCL) on Monday because they believe USDC stablecoin issuers will manage to maintain growth regardless of the upcoming competition. Analysts specifically mentioned concerns about the debates related to Hyperliquid and whether the ultimate Hyperliquid stablecoin will have a significant impact on USDC. Recently, Hyperliquid announced an auction of the stablecoin code of its Layer 1 blockchain HyperEVM. Some people on social media have made the point that Hyperliquid’s launch of its own stablecoin could lead to a decrease in USDC’s activity on Hyperliquid’s popular futures exchange. Analysts at Bernstein said nearly 7.5% of the total USDC supply was “used as collateral for the Hyperliquid perpetual futures platform.” Stablecoin issuers Paxos, Frax Finance and Agora, as well as a new team called Native Markets, have expressed interest in issuing Hyperliquid’s upcoming USDH stablecoin, which was announced in a Discord post on Friday. Bernstein analysts acknowledge that the launch of Hyperliquid stablecoins and other stablecoins should create a more competitive environment, but the impact on Circle will not be immediate. "Driven liquidity for new stablecoins is not easy, especially for crypto capital market products such as futures, where position size and execution efficiency are critical. Hyperliquid may choose to work with more stablecoin partners, including Paxos, to enhance the resilience of its platform, but building liquidity on its futures products is a gradual process," analysts wrote in the report. As some expect the stablecoin market to grow to trillions of dollars, several companies, including World Liberty Financial, supported by Donald Trump, are trying to create more demand for their dollar-pegged tokens. Other banking giants such as Bank of America are also preparing to create their own stablecoins. On Sunday, Circle co-founder and CEO Jeremy Allaire — possibly because Hyperliquid’s launch of stablecoins could hurt USDC’s push — retweeted a July statement announcing USDC will be deployed on HyperEVM. "Don't believe in hype. We will enter the HYPE ecosystem in important ways. We intend to be a major player and contributor to the ecosystem," Allaire said in a post posted to X over the weekend. Bernstein's analysts also said they are confident in Circle's growth potential because there is the potential for additional favorable factors. “As the rate cut cycle begins, we expect the digital asset cycle to shift towards risk appetite, further driving USDC demand (and demand for on-chain USDC earnings). In addition, stablecoin demand from payments and financial services integration is still in its early stages as Circle continues to grow its USDC financial ecosystem.” In their Monday report, analysts at Bernstein also said, “USDC has gained market share relative to Tether (30% today compared to 28% in the second quarter). Tether’s USDT stablecoin is the largest global stablecoin supply.