Morgan Stanley downgraded Circle to Underweight and cut its price target from $106 to $38.The brokerage lowered its USDC circulation forecasts for 2027 and 2028, citing slower stablecoin growth and pressure on reserve income.Circle shares fell about 6% in premarket trading after the downgrade, while TD Cowen initiated coverage with a Buy rating and an $82 price target.Morgan Stanley said real world stablecoin payments remain limited despite rising industry adoption.The downgrade comes days after Circle secured a New York trust charter and ahead of its second quarter earnings report.