Circle's biggest short seller "surrendered" and upgraded its rating, but still warned that its stock price movement would be like a crypto rollercoaster.

PANews reported on January 30th that, according to CoinDesk, on January 30th, 2026, Wall Street analyst Ed Engel, the biggest short seller of Circle stock, upgraded its rating from "sell" to "neutral," but lowered its price target from $75 to $60, warning that the stock remains highly correlated with the cryptocurrency market and its price action is like a "roller coaster."

Engel points out that Circle's stock performance is increasingly in sync with the Ethereum and broader crypto market cycles. Over 75% of the supply of its underlying stablecoin, USDC, is used for high-risk activities in DeFi or on exchanges, resulting in a correlation of 0.66 between USDC and Ethereum prices, a trend that could continue until mid-2026. Therefore, despite being a "stablecoin" issuer, Circle has essentially become a cyclical stock, and its valuation remains high. Potential upside catalysts include the passage of the Clarity Act (which Engel believes has a 60% probability) and the tokenization trend of US assets in DeFi, which could provide a clearer regulatory basis for USDC's growth and reduce its dependence on overall crypto sentiment. Engel believes that the company's revenue will remain closely tied to speculative activities in the short term, and a true decoupling from the crypto cycle may take several years.