CRCL's Arc Adoption Expands: Is a New Revenue Engine Taking Shape?

Circle Internet Group CRCL is laying the groundwork for its next growth phase by expanding Arc adoption. With the successful launch of Arc’s public testnet and participation from more than 100 global institutions across banking, payments, capital markets and digital assets, the company is signaling a shift from being primarily a stablecoin issuer toward becoming a full-stack financial infrastructure platform.

Rather than focusing on near-term transaction fees, Circle is first building a broad ecosystem of developers, enterprises and institutions. This approach mirrors successful platform strategies in cloud and software, where adoption and stickiness lead to long-term pricing power.

Arc is already integrated across Circle’s broader platform, including USDC, tokenized assets such as USYC, and the Circle Payments Network. This integration strengthens network effects and increases the likelihood that Arc becomes embedded in enterprise workflows over time. Management’s exploration of a native Arc token could further align incentives and open up future monetization opportunities.

While Arc is still in the early stages and its mainnet launch is planned for 2026, strong institutional interest and Circle’s infrastructure-first strategy point to solid long-term potential. As adoption scales, Arc could help reduce reliance on interest-sensitive reserve income and support higher-margin platform revenues. Reflecting this prospect, the Zacks Consensus Estimate projects 2026 revenues to rise 18.2% year over year to $3.22 billion.

Where Does CRCL Stand Against Competitors?

As the largest U.S. crypto exchange, Coinbase Global COIN is a key competitor to Circle in stablecoin distribution and crypto payments. COIN’s massive user base, liquidity and broad platform support USDC adoption, but the company’s revenues remain highly sensitive to trading cycles and market downturns. In contrast, CRCL’s focused, fee-based stablecoin model offers simpler execution and potentially more durable growth than COIN’s cyclical, complex ecosystem.

PayPal PYPL competes with Circle via PYUSD in blockchain payments and consumer stablecoin adoption. PYPL leverages its vast PayPal and Venmo networks to drive usage at scale, giving the company an immediate distribution edge. However, compared with its platform-centric approach, CRCL remains more blockchain-native and infrastructure-focused, positioning it as a neutral stablecoin provider rather than a closed-ecosystem payments giant like PYPL.

CRCL’s Share Price Performance, Valuation & Estimates

In the trailing six-month period, Circle’s stock has declined 58.4%, lagging behind the broader Zacks Finance sector, which returned 11.2% and the Zacks Financial - Miscellaneous Services industry, which lost 4.2%.

CRCL’s Six Month Price Performance

From a valuation standpoint, CRCL appears overvalued, trading at a forward 12-month price-to-sales ratio of 6.11, higher than the industry's average of 3.36. The company carries a Value Score of D.

CRCL’s Valuation

The Zacks Consensus Estimate for 2025 earnings is pegged at a loss of 87 cents per share, unchanged over the past 30 days. The consensus estimate for 2026 earnings is currently pegged at 92 cents per share and has remained steady over the past 30 days.

Circle currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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