Interest rate cuts may lead to a big dump in Circle's revenue; USDC supply needs a significant increase to cope.

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[Chain News] On August 14, investor Omar from an investment company stated that interest rate cuts are undoubtedly terrifying for companies sensitive to interest rates like Circle. A cut of 100 basis points would reduce Circle's total revenue by $618 million (-23%), gross profit by $303 million (-30%), and profit margin by 3.3 percentage points. In terms of valuation, this requires raising a high-priced stock trading at 42 times EV/rr gross profit to 60.4 times (about a 50% premium). To offset the impact, the supply of USDC needs to increase by $28 billion (approximately 44% of the current $64 billion) to remain neutral. Omar said that interest rate cuts are imperative, which is why we saw Circle conduct a massive stock sale of about $1.5 billion yesterday, and why Circle is eager to launch products that monetize trading flow (CPN and Circle Chain).

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WagmiWarriorvip
· 08-15 19:17
Stop messing around, Circle.
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0xTherapistvip
· 08-15 06:19
This is really dangerous.
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GasFeeCrybabyvip
· 08-15 03:15
fell badly
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SoliditySlayervip
· 08-14 02:26
Circle Pill
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SolidityNewbievip
· 08-14 02:25
Heartbreaking Circle
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TheShibaWhisperervip
· 08-14 02:22
The expectation of interest rate cuts is so strong, better rug pull early.
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OffchainOraclevip
· 08-14 02:18
Gross profit big dump 30% This is very deadly.
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BearMarketNoodlervip
· 08-14 01:56
Even this small fall can be called terrifying.
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