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Mizuho cautions that Circle's OCC approval may not boost USDC growth
Mizuho said USDC market capitalization has been declining since March and warned a new consortium-backed stablecoin, Open USD, could intensify competition.
Mizuho reiterated a neutral view on Circle after the company received final approval from the Office of the Comptroller of the Currency to establish First National Digital Currency Bank, saying the regulatory milestone does not address the stablecoin issuer’s core challenges.
The bank pointed to USDC’s declining market capitalization since March as a key concern, arguing that market reaction to the approval may be overly optimistic given issues already weighing on Circle’s stock.
Mizuho also highlighted competition risks from Open USD, a new consortium-backed stablecoin it said could accelerate rivalry in the stablecoin market and pressure Circle’s business.
On the fundamentals, the report noted circulating USDC supply fell by roughly $7 billion from its March peak to about $74 billion in July, describing the contraction as the largest monthly decline since 2022, even as it said on-chain usage remains strong, according to CoinDesk.