- The Fed acknowledged that stablecoins (such as USDC-USD) are useful if they're regulated well, this is a bullish note to Circle.
- Circle's USDC-USD now accounts for approximately a third of the stablecoin supply thanks to its aggressive expansion of USDC-USD via humanitarian efforts, financial institutions, and the crypto industry.
- Circle is now trading near its $10 NAV again, but its valuation becomes more justifiable after the bullish note from regulators.
- However, our studies align with scientific literature in showing Circle's sector, the innovation growth sector, is expected to underperform amid inflationary environment going into 2022.
- Despite Circle's bullishness, we expect Circle to trade near its $10 NAV floor before merger but drop below its $10 floor after merger due to macroeconomic conditions.
For further details see:
Circle: The Fed Confirmed Our Bullish Thesis