Stablecoin supply is accelerating toward a milestone few would have predicted two years ago. Yet one of the sector’s dominant issuers is drawing little investor excitement. According to a CoinDesk report , Bitwise analyst Ryan Rasmussen believes the market is mispricing Circle as stablecoins march toward trillions in total market cap.
Circle, issuer of the USDC stablecoin, has been quietly building out a payments infrastructure that goes far beyond simple on-chain dollar representation. The company holds over $60 billion in assets backing its stablecoin, yet private market valuations do not fully reflect its position at the center of a rapidly expanding liquidity layer.
The Trillion-Dollar Stablecoin Thesis
Stablecoin supply has more than doubled from its 2023 lows. Fiat-backed tokens now circulate across most major blockchains, functioning as the settlement rails for DeFi lending, derivatives, and cross-border payments. At current growth rates, the total stablecoin market cap appears on track to exceed $1 trillion within a few years. Circle, together with Tether, controls the vast majority of this volume.
Rasmussen’s argument hinges on the idea that investors are thinking too narrowly. They see Circle as a stablecoin issuer vulnerable to interest rate compression, instead of as an infrastructure company whose margins will hold up as payments volume scales. That framing matters because payment flows are stickier than speculative crypto trading. As Circle builds out compliant, institutional-grade payment plumbing, the revenue profile shifts from reserve interest income toward transaction-based fees.
This is not merely theoretical. Circle’s recent partnerships with traditional payment processors and its expansion into markets outside the U.S. indicate a company positioning for a world where stablecoins become the default digital dollar for both retail and wholesale settlement. The regulatory environment, however, remains a critical variable.
The price tag Congress puts on stablecoin regulation will determine how quickly banks and non-bank issuers move. The current legislative fight over the biggest crypto bill in U.S. history shows how intensely banks are resisting a framework that could allow non-bank stablecoin issuers like Circle to flourish with clear legal standing. If final language favors large bank access to stablecoin issuance with fewer restrictions, Circle’s early-mover advantage may get a tailwind; if not, it faces a more fragmented path.
What Markets Are Missing
One reason Circle may be mispriced is that secondary share trading platforms do not fully capture the economics of a company that can generate billions in annualized revenue from a relatively simple product. Tether, unregulated and opaque, reports profit figures that rival top Wall Street firms. Circle, by contrast, has prioritized transparency and regulatory compliance, which suppresses short-term profitability but builds a deeper licensing moat.
The payments infrastructure angle is what Rasmussen highlights. Circle’s Web3 Services platform enables businesses to accept stablecoin payments, manage on-chain treasuries, and integrate USDC into consumer apps without holding crypto themselves. That pipeline becomes more valuable as tokenized real-world assets expand. The recent tokenization milestone of $20 billion in on-chain real-world assets shows that demand for settlement-ready digital dollars is far from peaking. As tokenized Treasuries, private credit, and institutional trading instruments move on-chain, USDC is positioned as the preferred settlement asset.
Investors still betting against the stablecoin thesis point to competition from bank-issued digital deposits, CBDCs, and Tether’s dominance. Tether’s USDT remains the most widely used stablecoin by trading volume, especially in emerging markets. Circle must prove it can capture market share not just from crypto-native traders but from businesses transacting across borders. That requires a level of execution that has historically disappointed some early backers.
Circle’s public listing plans have been paused and restarted multiple times, and market sentiment toward crypto companies trying to go public remains cautious. Yet the underlying growth of stablecoins suggests that a company with a durable fee stream and a strong balance sheet will eventually command a premium. Institutional demand for on-chain infrastructure shows that capital is willing to price in future utility, even when near-term narratives are mixed.
The Uncertainty Built Into Circle’s Premium
What remains difficult to model is the regulatory trajectory. Circle operates across jurisdictions with different stablecoin rules. The European Union’s MiCA framework gives it a passport across the bloc, but the U.S. still lacks comprehensive federal legislation. The fast-moving Senate bill mentioned earlier could reshape the competitive landscape overnight. If the final version gives depository institutions exclusive rights to issue stablecoins, Circle’s license-based model may face forced partnerships with banks, altering the margin structure.
There is also the question of market saturation. Stablecoins already render many speculative trading pairs liquid. Further growth must come from non-trading use cases: remittances, merchant settlement, payroll, programmable payments. Circle’s bet on payments assumes that these use cases will develop faster than DeFi lending reached its peak. If that assumption proves wrong, the company’s valuation will correct down to match interest income only.
For now, the Bitwise view is that the market is underpricing Circle’s optionality. As stablecoins grind toward the trillion-dollar mark with little sign of slowing, the gap between how crypto-native analysts and traditional investors see the stablecoin business is becoming a material pricing inefficiency.
