Stablecoins do not generate interest. $CRCLX Is it still worth holding for the long term???

The core logic of Circle can be understood as a platform that bundles US Treasury bonds for you and earns interest. The larger the USDC scale, the more interest it can earn. So logically, Circle's valuation is essentially anchored to the issuance scale of USDC, fundamentally a machine that follows US Treasury yields.

Currently, USDC is approximately $77.6 billion in size, about $2 billion less than last week, indicating that funds are flowing out.

On March 25th, there was a 20% drop mainly due to new policy changes. The U.S. Senate's "Digital Asset Market Clarity Act" draft directly restricts platforms like Coinbase from offering yield to USDC users. It essentially blocks the ability to earn interest on stablecoins.

This reduces users' earnings, and USDC's attractiveness naturally diminishes, putting it at a disadvantage in the stablecoin competition.

Additionally, Tether, Circle's biggest competitor, is also moving toward compliance. Previously, people criticized its lack of transparency, but now it is addressing this shortcoming. Once it becomes more regulated, USDC's original advantage will become less obvious, and competition will intensify. If Tether successfully goes public, then Circle will no longer be the only stablecoin concept stock in the U.S. stock market, reducing its scarcity and potentially dampening market sentiment.

In the short term, policies are tightening, competitors are strengthening, and there are signs of continued fund outflows.

But if we look at a longer timeframe, the stablecoin sector is expanding. It’s not about one killing the other, but about growing the overall pie. Essentially, stablecoins are on-chain dollars backed by US Treasury yields, and this logic remains valid.

Regarding the price, if CRCL drops below 80 later, I will consider buying a bit more. Overall, I am focused on the long term, though short-term fluctuations are inevitable.