To The Moon

$Circle Internet Corp.(CRCL)$  

I own a bit of CRCL and just bought some recently. 

So I understand why this chart feels uncomfortable.

Circle closed around $80, then fell toward $76 overnight.

Earnings are coming on:

NOVEMBER 4

And suddenly the signals look frightening.

CRCL sliding.

Bitcoin weak.

Crypto equities under pressure.

Implied volatility around 85%.

Put/call ratio around 2.93.

USDC circulation recently declining.

If you are holding CRCL into earnings, the obvious thought is:

“Does somebody know something?”

I don't think that is the right conclusion.

But I also don't think we should dismiss what the market is telling us.

Because there IS a problem developing underneath Circle's story.

And strangely, it may also tell us exactly what CRCL needs to prove next week.

🔴 FIRST, LET'S NOT SUGARCOAT THE CHART

CRCL has fallen from roughly $85 toward $76 in only a few sessions.

The stock is now testing an area I previously identified as my:

THESIS-CHECK ZONE.

That matters.

But context matters too.

This has happened during a brutal risk-off period.

Bitcoin has been hovering around $80K.

Crypto-related equities have been weak.

Technology has been hammered.

Amazon fell.

Alphabet collapsed.

Intel collapsed.

So CRCL is not falling in isolation.

There is a major difference between:

CRCL falling because Circle's business deteriorated

and

CRCL falling because investors are reducing risk before a binary earnings event.

Right now, I think we are seeing some of both.

🧠 THE OPTIONS MARKET LOOKS SCARY, BUT READ IT PROPERLY

The screenshot circulating shows:

IMPLIED VOLATILITY: ~85%

PUT/CALL RATIO: 2.93

At first glance:

🔴 VERY BEARISH.

But not necessarily.

A high put/call ratio before earnings often means investors are:

buying protection

hedging existing shares

positioning for volatility

rather than making an outright prediction that the stock will collapse.

And then look at one of the larger trades.

A trader paid approximately:

$32,000

for a debit call spread:

LONG $88 CALL

SHORT $92 CALL

That structure profits if CRCL moves upward toward the high $80s and low $90s.

Both strikes were out of the money.

That trader was not betting on collapse.

They were betting on:

UPSIDE WITH DEFINED RISK.

So the options market is actually giving us a more nuanced message.

PUT/CALL RATIO:

Fear is elevated.

IMPLIED VOLATILITY:

A big move is expected.

$88-$92 CALL SPREAD:

At least some capital is positioning for upside.

My interpretation:

THE MARKET IS AFRAID, NOT CERTAIN.

That distinction matters.

🚨 BUT THERE IS ONE NUMBER I DO NOT LIKE

USDC circulation.

At the end of Q2:

$73.3B

USDC was in circulation.

Circle's latest transparency data showed approximately:

$71.0B

And over the latest 30-day period:

USDC circulation fell roughly $4.2B.

This is the number CRCL bulls should be watching.

Because Circle's current earnings engine remains heavily tied to reserve income.

Very simplified:

USDC BALANCE

×

RESERVE YIELD

=

RESERVE INCOME

Then Circle has to subtract enormous distribution costs.

So if:

USDC ↓

and eventually:

INTEREST RATES ↓

you can see the problem.

That is why simply saying:

“Stablecoins are the future.”

is not enough to justify CRCL's valuation.

Circle needs another engine.

🔥 AND THIS IS WHY NEXT WEEK'S EARNINGS MAY BE MUCH MORE IMPORTANT THAN EPS

Wall Street expects approximately:

$790M-$800M revenue

and roughly:

$0.37-$0.40 EPS.

Circle could beat both.

And I could still dislike the report.

Circle could also produce merely respectable headline numbers.

And I could become more bullish.

Why?

Because I am watching something deeper.

CAN CIRCLE DECOUPLE REVENUE GROWTH FROM INTEREST RATES?

That is the entire long-term CRCL thesis for me.

🧠 THE OLD CIRCLE EQUATION

Historically, Circle's economics have looked something like:

MORE USDC

↓

MORE RESERVES

↓

MORE INTEREST INCOME

↓

MORE REVENUE

That is a fantastic business while:

USDC grows

and

rates remain high.

But investors are increasingly worried about what happens when one or both stop helping.

And there is another complication.

🔴 CIRCLE DOES NOT KEEP ALL THE ECONOMICS

This is perhaps the most misunderstood part of CRCL.

Circle pays substantial distribution incentives.

Coinbase alone received approximately:

$324.6M

of distribution costs from Circle in Q2.

That is enormous.

Circle has also expanded its Binance relationship.

Binance invested $100M in Circle in September at:

$80.84 per share

and the companies entered an expanded five-year commercial arrangement.

Circle will pay Binance incentives linked to USDC held through the relevant infrastructure.

So Circle's problem is not merely:

Can USDC grow?

It is:

HOW MUCH ECONOMIC VALUE DOES CIRCLE KEEP WHEN USDC GROWS?

That is a completely different question.

And it is the number I think serious CRCL investors should increasingly focus on.

🔥 THE METRIC I WANT: REVENUE PER USDC DOLLAR

Imagine two scenarios.

SCENARIO A

USDC grows 30%.

Circle's revenue grows 15%.

Distribution expenses explode.

Bad.

SCENARIO B

USDC grows 10%.

Circle's revenue grows 20%.

Transaction revenue rises.

Payments expand.

Arc monetises.

Distribution economics improve.

Much better.

This is why I think investors may eventually stop valuing Circle on:

USDC MARKET CAP

and start valuing it on:

USDC ECONOMIC YIELD.

In other words:

How much value can Circle extract from every dollar moving through its ecosystem?

That is the transition I want to see.

🟢 THERE ARE ALREADY SIGNS OF THE SECOND ENGINE

Q2 USDC on-chain transaction volume reached:

$14.8 TRILLION

up:

151% YoY.

That is fascinating because usage grew far faster than USDC balances.

This distinction matters enormously.

Stablecoins can create value in two ways.

STOCK

How many USDC exist?

and

FLOW

How much economic activity moves through USDC?

Circle's current business model monetises the first extremely well.

Its future business model needs to monetise the second.

That means:

Payments

Cross-border settlement

Circle Payments Network

Arc

Enterprise infrastructure

Transaction fees

Programmable finance

This is the real earnings story.

🔥 ARC COULD BECOME THE VALUATION BRIDGE

This is why I keep watching Arc.

Circle describes Arc as an enterprise-grade blockchain built around stablecoin finance.

The opportunity is much bigger than issuing USDC.

Imagine Circle eventually owning more of the infrastructure through which USDC moves.

Today:

USDC → RESERVE INCOME

Tomorrow:

USDC

↓

PAYMENTS

↓

SETTLEMENT

↓

FX

↓

TOKENISATION

↓

ARC

↓

ENTERPRISE SERVICES

That turns Circle from:

A STABLECOIN ISSUER

into:

FINANCIAL INFRASTRUCTURE.

And those businesses deserve very different valuation multiples.

But next week I want evidence.

Not PowerPoint slides.

🚦 MY FIVE-NUMBER CRCL EARNINGS SCORECARD

Forget whether EPS beats by three cents.

I will look at these:

🟢 1. USDC CIRCULATION

Has the recent decline stabilised?

More importantly, what does management say about Q4?

🟢 2. USDC TRANSACTION VOLUME

If circulation is flat but transaction volume continues exploding, that strengthens my velocity thesis.

🟡 3. RESERVE INCOME

Still critical today.

But I increasingly want it to become LESS dominant over time.

🔥 4. NON-INTEREST REVENUE

This is my most important long-term metric.

I want evidence that payments, infrastructure and transaction revenue can grow faster than reserve income.

🔥 5. DISTRIBUTION COSTS

Possibly the most underrated number.

USDC growth is much less valuable if Coinbase, Binance and other distributors capture an increasing percentage of the economics.

📍 NOW THE QUESTION EVERY CRCL HOLDER IS ASKING

IS $76 A BUY?

My answer has changed slightly.

Before this selloff I viewed roughly:

$79-$81

as my preferred accumulation area.

We have now gone through it.

At around $76, the risk/reward is becoming more interesting.

But earnings are only days away.

That changes how I would size it.

🟡 $75-$78: HOLD / SMALL ADD

We are here.

I would not panic-sell solely because the stock has fallen into earnings.

But neither would I deploy all my ammunition before a binary event with implied volatility near 85%.

For someone already heavily positioned:

I would preserve cash.

🟢 $70-$74: FIRST AGGRESSIVE PICK

If CRCL gets flushed here BEFORE earnings without a deterioration in Circle-specific fundamentals, I become considerably more interested.

🟢 $64-$69: DEEP-VALUE / FEAR ZONE

This would represent a serious reset.

I would only buy aggressively if:

USDC fundamentals remain intact

and

the fall is primarily valuation/liquidity driven.

🔴 BELOW $64: THESIS CHECK

At that point I would not blindly average.

Something may have changed.

Now upside.

🟢 $80-$82: FIRST RECLAIM

This gets CRCL back above the recent breakdown.

🟢 $85-$86: REPAIR

Interesting because this is also around the post-earnings anchored VWAP area.

🟢 $88-$92: CONFIRMATION

Notice something?

That is almost exactly where the large call spread is positioned.

A move through this region after earnings would tell me institutions are willing to rebuild exposure.

🟢 ABOVE $92

Then I start looking toward:

$96-$100.

That remains the important psychological zone.

🔮 MY EARNINGS SCENARIOS

🟢 30%: THE MARKET REALISES IT GOT TOO BEARISH

Circle beats.

USDC outlook stabilises.

Transaction volume remains strong.

Management provides encouraging evidence around Arc, Payments Network or non-interest monetisation.

CRCL reclaims:

$85

then challenges:

$88-$92

A strong enough report could bring $96-$100 back into play.

🟡 45%: GOOD NUMBERS, WRONG QUESTIONS

This is my base case.

Revenue/EPS are respectable.

USDC usage remains strong.

But reserve income and distribution economics still dominate the story.

The market says:

“Fine. Show me the next growth engine.”

CRCL could remain volatile between roughly:

$72-$88.

This would actually create opportunities for patient accumulation.

🔴 25%: THE FEAR IS JUSTIFIED

USDC balances weaken.

Revenue disappoints.

Distribution costs remain elevated.

Management gives little evidence that payments, Arc or transaction monetisation can offset future reserve-yield pressure.

Then:

$70

can break.

And the market could test:

$64-$69.

That is the scenario where I would reassess rather than automatically buy.

🚨 THERE IS ALSO A NEW SHORT-TERM RISK

The recent Binance security breach complicates the immediate setup.

Circle and Tether froze stablecoins linked to the exploited wallets.

For Circle, this is both:

🔴 headline risk

and

🟢 evidence of regulated stablecoin control infrastructure.

But combined with weak crypto markets, it gives traders another reason to reduce exposure before earnings.

That may partly explain why CRCL is being sold harder than its fundamental news alone would suggest.

🧠 SO IS THE DROP TO $76 A BAD SIGN?

Technically:

YES.

The stock has lost important support.

Sentiment is poor.

Crypto beta is weak.

USDC circulation has softened.

I will not pretend those signals do not matter.

Fundamentally:

NOT YET.

Nothing I have seen tells me next week's earnings are destined to disappoint.

And the options market certainly does not tell me that.

A 2.93 put/call ratio says:

FEAR.

85% implied volatility says:

BIG MOVE EXPECTED.

The $88-$92 debit call spread says:

SOMEONE IS WILLING TO PAY FOR UPSIDE.

Put them together:

THE MARKET IS PRICING UNCERTAINTY, NOT CERTAINTY OF DISASTER.

That is a very important distinction.

MY CALL

I am not selling CRCL simply because it has fallen before earnings.

But I am also not pretending this is automatically a gift.

Circle now has to prove something bigger than an EPS beat.

Q2 already showed us:

USDC $73.3B

ON-CHAIN VOLUME +151%

REVENUE +7%

Notice the mismatch?

Usage exploded.

Revenue did not.

THAT is the issue.

The next phase of the CRCL thesis therefore depends on Circle converting:

USDC ADOPTION

into

CIRCLE ECONOMICS.

That is why my most important question next week will not be:

“Did CRCL beat EPS?”

It will be:

“IS VOLUME STARTING TO REPLACE YIELD?”

If the answer becomes yes, CRCL can eventually deserve to trade like financial infrastructure rather than a leveraged bet on Treasury yields.

If the answer remains no, the market will keep asking what happens when rates fall.

So at $76?

🟡 I HOLD.

🟡 I KEEP AMMUNITION.

🟢 I ADD selectively into fear.

🔴 I do NOT blindly average through a broken thesis.

Because next week's earnings are not just another quarter.

They are a test of whether Circle is beginning to become something much bigger than:

USDC × INTEREST RATE.

And if it is?

Then this selloff may eventually look very different.

I am not a financial advisor. Trade wisely, Comrades!

CRCL holders: are you adding around $76, waiting for earnings, or protecting your position until Nov 4?

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