Circle shares rise 4% as Polymarket-driven USDC growth prompts analyst upgrade

Shares of Circle (CRCL) rose 4% Wednesday after Japanese finance giant Mizuho upgraded the stock to neutral, pointing to a surge in activity on crypto prediction platform Polymarket as a new driver of growth for Circle’s stablecoin, $USDC.

“When we initiated CRCL with an Underperform ... Our worry then was that meager $USDC distribution, declining interest rates and fierce competition from Tether's $USDT would weigh on the stock,” analyst Dan Dolev wrote. “Since all Polymarket bets are settled in $USDC, we now see $USDC on Polymarket as a looming catalyst."

Polymarket’s 2026 trading volumes are off to a fast start, according to the note, with annualized volumes of looming around $50 billion, three times the amount in 2025. Mizuho estimates that the current run-rate could drive ~25% potential upside to $USDC market cap or more.

As a result, Dolev raised his forecasts for the average $USDC in circulation for 2026 and 27 by ~7% and ~21%, respectively, which in turn increases his revenue estimates by ~6% and ~21% for those years.

He also pointed to broader trends behind the rise of event-driven crypto trading. “After the 2024 U.S. election (which sparked the prediction market craze), these platforms diversified into sports, economics, and pop culture bets, which attracted a larger user base and volume.”

Polymarket, Dolev noted, is particularly well-positioned. “Polymarket draws a large share of non-crypto-native users into crypto via event trading, which drives incremental demand for $USDC from outside the usual DeFi audience.” He said that the prediction platform will likely expand further in the next two years which would add billions in incremental $USDC market cap.

Still, Dolev stopped short of issuing a bullish call, and his $77 price target suggests just modest upside from the current level just above $70. “Although Polymarket is certainly a potential boost to $USDC," he said, "this is somewhat offset by other adverse drivers including: Looming rate cuts, rising cost of distribution and intense competition from both stablecoin players like Tether $USDT$0.9988 and incumbent financial institutions launching their own stablecoins.”

Circle's 4% advance on Wednesday comes as most crypto-related names are declining alongside continued sluggishness in the price of bitcoin, which remains stuck below the $90,000 level.