Mizuho downgrades Circle on OpenUSD threat
Analysis based on 6 articles · First reported Jul 15, 2026 · Last updated Jul 15, 2026
The downgrade signals that stablecoin issuers may face margin compression as competition intensifies, potentially lowering valuations across the sector. Circle's stock fell 4.1% following the report, and the lowered price target suggests further downside if margin pressures persist.
Mizuho Financial Group downgraded Circle from Neutral to Underperform and slashed its price target from $85 to $50, citing competitive pressure from Alliance for OpenUSD, a new stablecoin backed by over 140 companies including Coinbase, Mastercard, Stripe, and BlackRock. Alliance for OpenUSD's pass-through model distributes most reserve income to partners, threatening Circle's margin structure. Mizuho raised its 2027 distribution expense ratio estimate to 73% and cut its adjusted EBITDA forecast to $699 million, 25% below consensus. Circle's upcoming revenue-sharing renegotiation with Coinbase in August adds further risk. The downgrade reflects structural margin compression in the stablecoin sector.
Set up alerts, explore entity relationships, search across thousands of events, and build custom intelligence feeds.
Open Dashboard