Circle selloff may miss the mark as Clarity Act targets distributors, not issuers: Bernstein Circle’s shares dropped as much as 20% in Tuesday trading amid concerns over proposed stablecoin yield limits, but analysts at Bernstein argue the market is misreading the implications of the Clarity Act. The proposed U.S. rules, which aim to regulate stablecoins, focus on restricting yield on passive balances held by users rather than targeting issuers like Circle. Bernstein’s analysis highlights a critical distinction: the Clarity Act primarily addresses distributors, such as platforms that offer yield to users, rather than issuers like Circle. The firm’s report notes that Circle earns income through its reserve management, investing $80 billion in short-term U.S. Treasurys to back its USDC stablecoin. This model generates about $2.64 billion in annual reserve income, without directly paying yield to token holders. The proposed rules would bar platforms from offering passive yield on stablecoin balances, similar to bank interest rates. However, activity-based rewards tied to trading or payments would still be permissible, with regulators tasked to define boundaries. Bernstein argues that Circle’s business model falls outside these restrictions, as it does not pass yield to users. The analysts suggest that limiting passive yield payouts could even strengthen Circle’s position by reducing competition from platforms offering aggressive yield incentives. Meanwhile, the immediate impact of the rules is expected to fall on intermediaries like Coinbase, which offers around 3.5% yield on USDC balances. Coinbase shares roughly half of USDC reserve income with Circle, and may need to adjust its rewards structure under the new rules.#coinbase #clarity_act #gautam_chhugani #circle #bernstein
Bernstein Sets $150,000 Bitcoin Target As ETF Inflows Surpass $1.6B In March Strategy, the Michael Saylor-led company that has made Bitcoin accumulation its core business, purchased $76.6 million worth of cryptocurrency last week, increasing its total holdings to 762,099 BTC — approximately 3.5% of the entire Bitcoin supply. Wall Street brokerage Bernstein used this move as a basis to reaffirm one of the most aggressive price forecasts in the market: Bitcoin reaching $150,000 before the year ends. Bernstein senior analyst Gautam Chhugani outlined the outlook in a note to clients, stating that BTC has found its price floor after months of decline. If correct, the forecast would mean the drop to around $60,000 in early February marked the lowest point in the current downturn, with all subsequent trends pointing upward. Bitcoin was trading above $71,000 at the time of the report, making the $150,000 target a potential over 110% increase from current levels. Chhugani attributed the upward momentum to two key factors: growing inflows into Bitcoin spot exchange-traded funds and rising corporate demand. The data supporting this claim is striking. Bitcoin spot ETFs recorded $167 million in inflows in a single day this week — their first positive day in four sessions — and have attracted $1.6 billion in net inflows since March began. The market saw a brief surge earlier in the week following reports that U.S. President Donald Trump had ordered a five-day pause in strikes on Iran, pushing Bitcoin to $71,750 before retreating. Corporate interest in Bitcoin is also expanding beyond Strategy. Australia’s pension fund Hostplus announced plans to offer clients Bitcoin exposure through self-directed portfolios. Morgan Stanley, a major global bank, has updated its SEC filing for a U.S.#bitcoin #morgan_stanley #michael_saylor #gautam_chhugani #hostplus
