Shares of Circle (CRCL) rose 4% on Wednesday after Japanese financial giant Mizuho upgraded the stock to neutral, pointing to a surge in activity on cryptocurrency prediction platform Polymarket as a new growth driver for Circle’s stablecoin USDC.
“When we started CRCL as an underperformer… Our concern then was that weak USDC distribution, falling interest rates, and fierce competition from Tether’s USDT would weigh on the stock,” wrote analyst Dan Dolev. “With all Polymarket bets settled in USDC, we now see USDC on Polymarket as an imminent catalyst.”
Polymarket’s trading volumes in 2026 are off to a fast start, according to the note, with annualized volumes hovering around $50 billion, three times the amount in 2025. Mizuho estimates that the current run rate could drive a potential ~25% increase in USDC market cap or more.
As a result, Dolev raised his forecasts for the average USDC in circulation for 2026 and ’27 by ~7% and ~21%, respectively, which in turn increases his revenue estimates by ~6% and ~21% for those years.
He also pointed out broader trends behind the rise of event-driven cryptocurrency trading. “After the 2024 US election (which sparked the prediction market craze), these platforms diversified into sports, economic and pop culture betting, attracting a larger user base and higher volume.”
Polymarket, Dolev noted, is particularly well positioned. “Polymarket attracts a large proportion of non-native crypto users to crypto through event trading, driving incremental demand for USDC outside of the typical DeFi audience.” He said the prediction platform will likely expand further over the next two years, adding billions in incremental USDC market capitalization.
Still, Dolev stopped short of issuing a bullish call, and his $77 price target suggests a modest upside from the current level just above $70. “While Polymarket is certainly a potential boost for USDC,” he said, “this is offset to some extent by other headwinds, including: impending rate cuts, rising distribution cost, and intense competition from stablecoin players like Tether.” and established financial institutions launching their own stablecoins.”
Circle’s 4% advance on Wednesday comes as most cryptocurrency-related names are falling along with continued sluggishness in the price of bitcoin, which remains stuck below the $90,000 level.
