Circle to hit $75 billion valuation by 2030 – Bitwise

Bitwise Chief Investment Officer (CIO) Matt Hougan outlined a bullish long-term outlook for stablecoin issuer Circle, projecting that the company could reach a $75 billion valuation by 2030.

In a memo on Wednesday, Hougan described recent declines in Circle's share price as "overblown," arguing that the company's core fundamentals remain strong.

Circle valuation hinges on long-term stablecoin market expansion

Hougan's forecast is based on Citigroup's projection that the global stablecoin market could reach $1.9 trillion by 2030. Assuming Circle maintains roughly 25% of that market, he estimates the company could continue seeing strong adoption as the stablecoin market expands.

Although banks and fintech firms may continue launching their own stablecoins, Hougan suggested that Circle's position may not be replaced.

"I'm skeptical that big banks will crush Circle. I think it's just as likely that Circle's market share will expand. After all, while Circle 'only' has 25% of the overall stablecoin market, it has a much larger share of the regulated stablecoin market," he wrote.

Hougan also projects annual revenue of around $3.8 billion at a 0.8% revenue growth rate, along with approximately $2.7 billion in net income.

The memo emphasizes that stablecoin growth is driven more by usability than yield. Many users already accept low returns on traditional bank accounts in exchange for convenience and reliability.

"People hold it because it works everywhere and is trusted, not because of the interest rate. That kind of stickiness doesn't disappear overnight," Hougan added.

Stablecoins offer additional benefits, such as faster global transfers, continuous settlement, and use as collateral in blockchain-based systems. As a result, demand for stablecoins could continue to grow even without interest incentives, the memo states.

Hougan's statement comes amid speculations that the latest CLARITY Act draft proposes restrictions on offering yield or similar rewards on stablecoins. While this could limit certain user incentives, Hougan said it may also reduce pressure on issuers like Circle to share interest income, potentially supporting margins over time.

Circle's stock price dropped 20% on Tuesday following announcements concerning the changes to the draft. The stock has since begun a recovery, rising nearly 3% on Wednesday.