Circle’s shares sell-off on Tuesday may have been overdone as investors failed to see that the stablecoin issuer’s core business model remains unaffected by the proposed CLARITY Act, analysts at Bernstein said on Wednesday.

In a note to clients, Bernstein analysts Gautam Chhugani, Mahika Sapra, Sanskar Chindalia and Harsh Misra said markets are conflating “who earns yield” with “who distributes yield.”

“Circle earns. Coinbase distributes,” the analysts wrote, noting that the draft legislation primarily targets the distribution of yield to users — not the underlying reserve income earned by issuers like Circle.

According to the latest draft, the CLARITY Act would prohibit platforms from offering yield on passive stablecoin balances or products deemed “economically equivalent” to interest. However, the proposal leaves room for activity-based rewards tied to user engagement, such as trading or payments.

“The stablecoin reward carve-outs could still allow distribution of rewards linked to user activity tiering,” the analysts said, adding that “the market knee-jerk reaction may not be calibrated.”

Circle’s business model relies on earning income from reserves backing USDC (USDC), which are primarily invested in short-term US Treasurys. Bernstein estimates this reserve income reached about $2.6 billion in 2025.

Circle shares fell roughly 20% on Tuesday following the legislative update, despite having gained more than 160% from their February lows. In mid-day trading on Wednesday, CRCL shares had clawed back some of the previous day’s decline, trading up more than 3.5% at last look.

Related: Crypto investor sentiment will rise once CLARITY Act is passed: Bessent

Bernstein reiterates bullish outlook on Circle as USDC adoption accelerates

This isn’t Bernstein’s first bullish call on Circle this month. Earlier in March, analysts reiterated their “Outperform” rating on the stock, setting a $190 price target, nearly double current levels.

The latest note reinforces that view, highlighting strong momentum in USD Coin (USDC). Its circulating supply has grown to $80 billion from roughly $30 billion over the past two years, driven by demand for trading, collateral, payments and global access to US dollars.

Bernstein also pointed to rising onchain transaction volumes as evidence of USDC’s expanding role across crypto markets and cross-border finance.

USDC is currently the second-largest US dollar-denominated stablecoin, behind Tether’s USDt (USDT).

Related: Deloitte, Stablecorp plan stablecoin infrastructure for Canadian institutions

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Bitcoin has again pressed up against a formidable wall near the $72,000 level, with bulls showing persistent demand despite ongoing macro and geopolitical uncertainty. Analysts say a sustained move above that resistance is required to renew a broader up leg toward the $80,000s, while traders watch for on‑chain signals that could confirm genuine accumulation rather than a mere short-term bounce. Notably, market participants have faced a backdrop of mixed sentiment as growth and risk assets digest recent shocks.

Market activity in March showed notable exchange outflows for BTC, a sign some observers interpret as cautious accumulation rather than immediate selling pressure. Analysts highlighted that while this flow does not yet establish a definitive uptrend, it underscores a shift in demand from sellers at lower price levels. That dynamic, combined with a valuation argument some investors are making, suggests a potential foundation for a longer-term rally if key levels are cleared. In that context, some observers point to the Yardstick metric as a narrative thread worth watching: in February, Yardstick readings dipped below the bear-market low seen in 2022, prompting discussions about whether BTC is entering a deep-value phase despite the ongoing price action.

Against that backdrop, traders and researchers are looking at the top few coins for clues about broader market health. The emphasis remains on whether risk appetite can reassert itself after recent volatility and whether the cryptocurrency complex can sustain a constructive bid at resistance levels that have repeatedly resisted breakthrough.

Key takeaways

• Bitcoin (BTC): The price action is forming an bullish ascending triangle, but a decisive move above $74,508 is needed to signal a fresh leg higher toward $84,000. A break below the current support line could expose BTC to a slide toward a $60,000–$62,500 zone.
• Ether (ETH): ETH bounced from the 50-day simple moving average and sits near a balance point. A sustained move above $2,400 would indicate the start of a new uptrend, with potential targets near $2,600 and then $3,050. Conversely, slipping back below the 50-day SMA would tilt the outlook toward $1,900–$1,750 in a deeper pullback.
• BNB (BNB): The pair remains range-bound roughly between $570 and $687 as buyers test higher levels. A breakout above $687 could target $730 and then $790, while a break below $600 risks a drop toward $570.
• XRP (XRP): Bears are defending the moving averages, but a sustained breakout above them could open a path to $1.61 and the downtrend line. A breakdown below $1.27 would reframe the setup toward the lower end of its channel.
• Solana (SOL): SOL has been confined between the 50-day moving average near $86 and resistance near $95. A breakout above $95 could lift prices toward $117, while a move below the 50-day SMA could drag the pair back into a $76–$95 range.

Bitcoin price outlook: a pivotal test above resistance

BTC is tracing an ascending triangle pattern on the daily chart, a classic setup that traders watch for a bullish breakout. The 20-day exponential moving average sits around $70,303, with the RSI hovering near midpoint, signaling a lack of a clear cross‑currents favoring either side in the near term. For the bulls to reclaim upside momentum, a sustained push above the $74,508 barrier would be a strong signal, potentially paving the way for a run toward the $84,000 mark as early as the next few sessions.

On the flip side, a break below the defining support line could tilt sentiment toward a deeper retracement, potentially drawing BTC down to the $60,000s. The balance between risk and opportunity remains delicate, as fundamental concerns mingle with price action in a market still digesting shocks from global tensions and evolving regulatory narratives.

Ether price compass: eyes on the $2,400 level

ETH has managed a modest rebound after testing lower levels, with the price turning higher after testing the 50-day SMA. The current setup suggests a wavering balance between supply and demand. A clear move above $2,400 would be a meaningful bullish cue, opening the door to a faster ascent toward $2,600 and ultimately toward $3,050 if momentum builds.

However, if selling pressure intensifies and ETH fails to sustain above the midline, the market could re-enter a softer phase. A drop through the $2,000–$1,900 zone would likely recalibrate expectations toward deeper support near $1,750, challenging any near-term upside.

BNB in a price‑range limbo: will it break out?

BNB has been clinging to a narrow corridor between roughly $570 and $687. The chart suggests a tepid, consolidative tone with the 20-day EMA flattening and the RSI hovering around the midpoint. A sustained climb above $687 would be a bullish signal, potentially targeting $730 and then $790 as the next milestones. Conversely, a breakdown below $600 would shift the balance toward the $570 level and could invite a further retreat toward the $500s if selling accelerates.

XRP: near-term path depends on how it handles moving averages

The XRP setup resembles a tug-of-war around the moving averages, with bulls pressing to extend gains beyond those technical levels. A sustained advance above these averages could push the price toward the $1.61 resistance level and the associated downtrend line, a zone that would likely attract fresh selling pressure from bears. If the price slips below $1.27, the downside could extend toward the channel’s lower boundary, where buyers are expected to re-enter.

Solana: a cautious bounce within a defined band

SOL has traded within a modest corridor, with the 50-day SMA near $86 acting as a critical line in the sand. A move past $95 could unleash a faster ascent toward $117, while failure to sustain the breakout would renew the range-bound dynamic between $76 and $95. The pattern suggests buyers remain tentative but capable of seizing control if they push through the overhead resistance.

Other notable coins in focus

Beyond the big three, several marquee tokens are reflecting similar themes of consolidation and selective breakouts. Cardano remains confined within a descending channel but shows attempts to stabilize near $0.25, while Cardano’s recovery would hinge on a decisive close above the moving averages to target the downtrend line and potential bullish extensions toward $0.39 and $0.44. Bitcoin Cash has inched above the 20-day EMA but faces a challenge to sustain momentum above the 50-day moving average; a move above that level could spark a relief rally toward $520, while a breakdown could bring the bears back into the frame. Chainlink has been tracing an ascending channel, with a potential breakout signaling a broader recovery toward the $11.61 hurdle and the $14.98 target if buyers gain the upper hand.

In aggregate, the market is balancing on a knife-edge: sentiment remains reactive to macro headlines while on-chain signals hint at underlying demand that could underpin a broader recovery if key resistance levels give way. The coming sessions will be telling as traders weigh whether this is a temporary pause within a longer ascent or a setup for a renewed phase of range-bound churn before the next decisive move.

For investors, the critical takeaway is to monitor the reaction at the major inflection points: $72,000 for BTC, $2,400 for ETH, and the nearby resistance bands across the top altcoins. Breakouts above those levels could reframe the risk/reward, while sustained closures below critical supports may extend the current consolidation. In a market that has proven prone to sudden shifts, preparation and disciplined risk management remain essential as the narrative around price discovery continues to evolve.

What to watch next: as on-chain signals, exchange flow data, and macro cues continue to evolve, traders will be watching for clear confirmation of breakouts or breakdowns at the levels highlighted above. The next few weeks could help determine whether this period is a temporary pause within a larger bull phase or a precursor to deeper consolidation across the market.

Circle (CRCL) was hit far harder than Coinbase (COIN) in Tuesday’s sharp selloff due to the crypto bill CLARITY Act’s latest stance on stablecoin yield, but one analyst says the regulatory shift may ultimately favor the stablecoin issuer.

Both names are seeing modest bounces on Wednesday, but remain solidly lower since the news leaked Monday evening.

The market may be missing the longer-term implication, argued Markus Thielen, founder of 10x Research: in the current form, the bill weakens Coinbase’s distribution-driven model more than Circle’s infrastructure role.

Coinbase currently captures the majority of USDC economics through its distribution agreement with Circle, Thielen explained. For USDC held on Coinbase, the exchange receives nearly all of the associated interest income, while off-platform balances are generally split about 50%-50. In practice, Thielen estimates that Circle pays Coinbase more than $900 million in revenue share each year, roughly half of Circle’s total revenue.

That arrangement has made stablecoin revenue a high-margin business for Coinbase. But if regulators shut down yield-like rewards on balances, part of that advantage may fade, Thielen said.

“The setup increasingly favors Circle on a relative basis,” Thielen wrote, arguing that the federal framework would shift value toward regulated issuers with compliance, scale and a credible balance sheet.

That could matter even more ahead of the two companies’ next commercial renegotiation in August 2026. Under a stricter federal regime, Thielen sees a better chance that Circle wins improved terms.

Circle could be worth double

Bitwise CIO Matt Hougan, meanwhile, said the selloff in Circle looks “overblown” as the CLARITY Act doesn’t change the long-term investment case.

Yield hasn’t been the main draw to stablecoins, he wrote in a Wednesday note. Most stablecoins don’t pay interest, yet adoption has surged because they make it easier to move dollars across borders, settle trades and access blockchain-based financial rails. In that sense, restricting yield doesn’t change the core use case.

Hougan points to forecasts projecting the market could grow to $1.9 trillion, or even $4 trillion, by the end of the decade. Circle, with a strong position in regulated stablecoins, stands to benefit if more activity shifts toward compliant, onshore players.

He also sees a potential upside from regulation itself. Limiting yield passthrough could reduce the revenue Circle shares with partners like Coinbase, helping improve margins over time.

Altogether, Hougan sees a path for Circle to grow to a much larger valuation — potentially around $75 billion, roughly double its current level.

“If stablecoins play out the way people think,” Hougan wrote, “you can be fairly conservative on most assumptions and still find Circle looking attractive.”

Startale Group said on Wednesday that SBI Group had invested $50 million to complete the company’s Series A, as the Japanese blockchain company develops tokenized securities infrastructure, stablecoins and consumer-facing onchain products.

In a press release shared with Cointelegraph, Startale said it closed a $50 million investment from SBI to scale products, including its Strium blockchain for tokenized securities, its Japanese yen and US dollar stablecoins, and a consumer-facing application that onboards users to onchain services. 

The deal would deepen institutional backing for Startale’s push into onchain financial infrastructure in Japan, where the company and SBI have already announced projects tied to tokenized securities, stablecoins and digital asset settlement.

“Through the deep collaboration with SBI, we will accelerate the adoption of tokenized stocks, centered on Japanese equities and JPY stablecoin, this year,” said Startale Group CEO Sota Watanabe. 

New funding to scale existing projects

The funding round follows a $13 million first close led by Sony Innovation Fund in January, bringing the company’s total Series A to $63 million. 

Startale said the newly-raised capital will be used to advance its vertically integrated strategy, building out a full stack that spans blockchain infrastructure, financial products and consumer-facing applications.

Related: Japan’s SBI VC Trade launches retail USDC lending as stablecoin use grows

The company plans to scale its Strium network for tokenized securities and real-world asset trading, expand adoption of its JPYSC and USDSC stablecoins, and develop its SuperApp to integrate payments, asset management and onchain services into a single platform.

On Feb. 5, Startale Group and SBI Holdings launched Strium, a layer-1 blockchain designed to support settlement infrastructure for institutional trading of foreign exchange, tokenized equities and RWAs. 

Startale Group deepens ties with SBI

The new capital raise also follows a series of collaborations between SBI and Startale. On Aug. 22, 2025, SBI formed partnerships with Startale, Circle and Ripple to launch stablecoin ventures and a tokenized asset trading platform in Japan.

On Dec. 16, SBI and Startale signed a Memorandum of Understanding to develop a fully regulated JPY stablecoin, targeting tokenized assets markets and global settlement. Under the MoU, the project will be issued and redeemed by a wholly-owned subsidiary of SBI Shinsei Bank called Shinsei Trust & Banking. 

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