Hyperliquid is planning to launch its own stablecoin, in a move that could reduce the decentralized exchange’s (DEX) dependency on Circle’s USDC.

In spite of these fears, USDC supply has surged to $72.5 billion, running 25% ahead of Wall Street broker Bernstein’s 2025 estimates. The firm had predicted that the stablecoin’s supply would reach $74 billion by year-end.

The stablecoin’s market share is «on a tear,» wrote analysts led by Gautam Chhugani in a Tuesday report.

Market share relative to Tether, issuer of the world’s largest stablecoin USDT, has also grown to 30%, up from 28% in the second quarter, the broker said.

Stablecoins are cryptocurrencies whose value is tied to another asset, such as the U.S. dollar or gold. They play a major role in cryptocurrency markets, providing among other things a payment infrastructure, and are also used to transfer money internationally.

The report noted that $5.5 billion in USDC (about 7.5% of supply) is currently used as collateral on Hyperliquid. While the exchange’s move introduces competition, it will be challenging to bootstrap sufficient liquidity for a new stablecoin in derivatives markets where execution reliability and sizing are critical, the analysts wrote.

Bernstein said that following the GENIUS Act, new stablecoin entrants are inevitable. However, liquidity bootstrapping for derivatives is non-trivial.

Concerns about Circle’s exposure to rate cuts (since lower interest income could impact revenues) miss the bigger picture, according to Bernstein analysts, as the stablecoin issuer benefits from expanding USDC supply.

Rate cuts could even support risk-on sentiment in digital assets, spurring further demand for USDC and related yield strategies, the report added.

Bernstein has an outperform rating on Circle shares, with a $230 price target. The stock was trading 1.2% higher, around $116, at publication time.

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