Circle Internet Corp. (CRCL) shares plummeted 5.08% during Tuesday's intraday session, extending recent losses for the digital payments company.

The sharp decline followed multiple analyst downgrades, with Mizuho cutting Circle stock to Underperform from Neutral and slashing its price target to $50 from $85. Analysts cited the significant threat posed by the newly launched dollar-pegged stablecoin Open USD, which debuted last month with more than 140 partners including Visa, Stripe, and Mastercard. Mizuho warned that Open USD could be "Circle's Cryptonite" and fundamentally alter Circle's business model.

Separately, JP Morgan also reduced its target price on Circle to $120 from $155. Circle's dominant USDC stablecoin faces increased competition as Open USD operates a "pass-through" model that returns most yield to partners, potentially challenging Circle's revenue model based on interest income from Treasury bill investments.