Circle faces up to 20% revenue risk from AI agents, Mizuho says

Mizuho has cut its price target for USDC stablecoin issuer Circle Internet Group Circle Internet Group, Inc. (CRCL) to $43 from $45, warning that AI personal assistant engines pose a "marked risk" to the firm's medium-term revenue. 

Mizuho analysts wrote in a Monday research report that they maintained an Underperform rating for the stock. Circle's shares closed down 7% at $79.84 on Monday, with Mizuho's price target implying a 46% downside from current levels.

"We believe AI personal assistant engines pose a marked risk to Circle's medium-term revenue," the analysts said.

The brokerage estimated that the wider adoption of AI agents could downsize USDC's (USDC) market capitalization by $4 billion to $9 billion and reduce Circle's reserve revenue. It cited a 10-20% medium-term downside risk to reserve revenue as AI agents steer USDC holders toward higher-yielding fiat alternatives or other platforms.

Mizuho's simulation also suggested that AI agents, including Muse, are likely to recommend steering away from USDC in favor of higher-yielding FDIC-insured fiat alternatives, such as savings accounts offered by SoFi.

Even when users insist on staying in crypto, the agents "seem to prefer other platforms" over holding USDC directly on Circle's ecosystem, according to Mizuho's report. 

As of the second quarter of this year, about 17% of USDC was held on Circle's platform, where holders earned no yield, while 30% was held on Coinbase and the remaining 53% on other platforms, according to the report.

Under a faster AI adoption scenario, Mizuho projected that ​​about $7 billion could move into fiat products and another $2 billion into higher-yielding stablecoins. That would shrink USDC's market cap by up to $9 billion and cut Circle's reserve revenue by 18%.

Lower forecasts

The analysts also lowered their forecast for average USDC in circulation in 2027 to $101 billion from $108 billion under wider AI adoption. This brings their projected reserve revenue down 5% to $4.1 billion from $4.3 billion. Their adjusted EBITDA forecast was also reduced by about 5% to $603 million from $635 million.

Earlier this month, Circle reported roughly $1.4 billion in revenue in the first half of 2026, and said it retained roughly 7 cents in net profit for every dollar of revenue. 

During the first half of the year, USDC settled more than $36 trillion in onchain transaction volume. USDC accounted for about 77% of all global stablecoin transaction volume by June, up from 60% a year earlier, according to Circle's Oct. 16 blog post.