Down More Than 70% From Its High, Is Circle Internet Group a Cheap Buy Right Now?

Circle Internet Group (NYSE: CRCL) was a hot cryptocurrency stock to go public last year. The company behind the popular USDC (CRYPTO: USDC) stablecoin has benefited from the rising popularity of its coin, resulting in strong growth along the way.

However, despite the impressive rally it went on shortly after going public, the stock quickly hit a peak of nearly $300. As of the end of last week, Circle Internet stock was down to less than $79 -- a decline of around 74% from its 52-week high. Given its steep drop in value, could now be an opportune time to add this crypto stock to your portfolio?

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Circle's growth has been impressive -- but can it continue?

Through the first nine months of 2025, Circle's top line has soared significantly. At just under $2 billion over the past three quarters, its revenue increased by a rate of 59% year over year. It's impressive, but the challenge is whether that rate can improve over time, particularly if interest rates are expected to come down in the near future.

The problem for Circle is that the vast majority of its revenue (96%) comes from reserve income. Its stablecoins are backed by fiat currency, and it earns interest and dividends on money that it holds in reserve accounts. Its reserve income rises if it earns higher rates of returns on those reserves, or if there's an increase in USDC that's in circulation.

For now, things are going extremely well for the company, as USDC in circulation has more than doubled in the past year. It's the second-largest stablecoin in the world by market cap, behind only Tether. But USDC's high rate of growth may not prove to be sustainable in the long run, jeopardizing the type of impressive top-line results the company has been able to generate thus far.

It's an expensive stock for the growth that it offers

There are also concerns about the company's earnings, which have been volatile in the past. While it did post a profit of $214 million in its most recent quarter (which ended on Sept. 30, 2025), it's still an expensive stock to own, especially when you consider the question marks about its future growth.

Currently, the stock trades at a forward price-to-earnings multiple of 85, which is based on analyst estimates for how it will perform in the year ahead. That's a hefty premium to be paying for a stock. And while it may be justifiable for a business that's growing at a fast pace, with such a high multiple, that would suggest that investors are also pricing in much more growth in the future, and that is far from a certainty at this point for Circle.

Buying the stock at such inflated levels can be risky, as it would leave investors with no margin of safety if the business were to struggle to maintain this high level of growth in the future.

Circle's stock isn't worth the risk

As the crypto world expands and there are more investing opportunities and more stablecoins out there, it can become much more challenging for a company such as Circle to maintain a high growth rate and for USDC to command a significant market share.

Ultimately, the big problem comes back to a lack of moat, or competitive advantage. Without that, there's simply not much of a reason to believe that Circle will be able to fend off competition and remain a compelling growth investment over the long term.

If you're optimistic about crypto, the best and safest option may simply be to invest in Bitcoin.

David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.