Stablecoin winners and their options: what traders can do after Circle's IPO frenzy

When Circle (CRCL) went public, it wasn’t just a milestone for stablecoins—it was a volatility supernova. In just two weeks, the stock surged from its opening trade around $68 to over $270. With that came a wave of options activity, pricing in nearly anything imaginable. For traders, the temptation is real: a hot narrative, a strong chart, and eye-popping implied volatility. But that same excitement can quickly become a trap.

Let’s take a closer look at why CRCL options are difficult to trade right now—and where else options traders might turn to capture the stablecoin opportunity without getting burned.

Why trading CRCL options is uniquely tricky right now

Circle’s options chain is a textbook example of post-IPO price discovery chaos. One-month implied volatility is hovering near 200%, while two-year expiries sit closer to 110%. That kind of vertical term-structure means front-month premiums are expensive, but also decaying quickly.

The skew is aggressive, too. Puts far below the money are significantly more expensive than calls equidistant above, suggesting strong demand for downside protection after CRCL’s 4x rally. That could reflect hedging flows or just traders unwilling to chase further upside.

Liquidity is another issue. Open interest remains thin across strikes and maturities, and bid-ask spreads can stretch 5% or more—especially in the wings. Combine that with unpredictable headline risk, a 50% revenue-share agreement with Coinbase, and a still-developing market structure, and you get an environment where it’s hard to plan, size, or adjust trades with confidence.

This doesn’t mean CRCL options are off-limits—but it does mean they’re complex, and probably best left to highly tactical structures or short-dated directional bets with strict risk controls. For most traders, it may be worth watching the smoke clear while exploring more stable terrain elsewhere in the ecosystem.

That said, for those determined to take a position in CRCL options, it’s crucial to understand the inherent risks. With implied volatilities this high, even strategies with well-defined risk—like spreads or butterflies—can behave unpredictably. It’s not uncommon to be directionally correct and still lose money if timing, entry levels, or vol crushes work against the trade. At a minimum, position sizing, exit planning, and scenario modeling should be approached with extra care. These markets reward precision, not just conviction.

Beyond Circle: trading the stablecoin ecosystem

If Circle is the engine of the stablecoin economy, several publicly traded companies act as the rails, gateways, and amplifiers of its impact. These businesses benefit from increasing USDC volumes, integrations into global payments, or the spread of tokenized U.S. dollar instruments.

Important note: The strategies and examples described are purely for educational purposes. They assist in shaping your thought process and should not be replicated or implemented without careful consideration. Every investor must conduct their own due diligence, considering their financial situation, risk tolerance, and investment objectives before making decisions. Remember, investing in the stock market carries risks, so make informed decisions.

Here are three groups worth exploring—and some high-level options strategies that align with their exposure to the stablecoin boom.

1. Coinbase (COIN): the liquidity hub

As Circle’s exclusive USDC partner, Coinbase receives 50% of the revenue generated from USDC’s reserve yield. In other words, when people hold USDC, both Circle and Coinbase get paid. That makes COIN a cleaner, more liquid proxy for the stablecoin trade (at least for now).

Unlike CRCL, Coinbase options are heavily traded and relatively well-priced. Near-term implied vol is high but not chaotic, and the term structure is flatter. Traders might consider:

• Selling short-dated puts while holding longer-dated calls can create a position that benefits from elevated front-end volatility while maintaining long exposure to the broader stablecoin trend. Traders might use this type of structure to take advantage of time decay and richer short-term premiums, while still participating in any longer-term upside.

• Delta-neutral straddles paired with longer-dated collars offer a framework for trading directional uncertainty, particularly around catalysts like earnings or regulatory announcements. These can help define risk while positioning for expansion or contraction in volatility, without making a strong directional bet upfront.

2. Visa & Mastercard: the transactional rails

Both Visa (V) and Mastercard (MA) have recently begun integrating stablecoin settlement into their networks. While the threat of disintermediation briefly spooked investors, these companies are also strategically positioned to benefit from the shift to blockchain-based payments.

With lower volatility and deep liquidity, these stocks suit defined-risk spreads:

• Call spreads funded by lower-delta put sales could let traders position for upside with limited downside. These defined-risk trades are often favored in names with low to moderate implied volatility, like Visa and Mastercard. Traders might look to structure these spreads when anticipating a steady re-rating of the stock, particularly as more stablecoin payment integrations roll out. The short put helps offset the cost of the long call spread, while still keeping downside exposure controlled.

• Calendar spreads around earnings or product rollouts might capture slow-burn re-rating. These trades can take advantage of volatility differences across expirations, while aligning with expected fundamental shifts. For example, traders anticipating stablecoin adoption updates or expanded merchant partnerships may position with front-month short calls and longer-dated long calls, expressing a directional view while minimizing exposure to immediate whipsaws.

3. PayPal & Fiserv: fintechs with first-mover advantage

PayPal (PYPL) and Fiserv (FI) are among the few traditional fintechs actively launching or supporting their own stablecoins. While market response has been lukewarm so far, any adoption within their existing ecosystems could be a game-changer.

Options are often underpriced relative to narrative potential. That opens the door to:

• Call butterflies for directional upside trades with low cost. Traders interested in playing a directional view in names like PayPal may find call butterflies appealing when expecting a moderate move higher toward a target range. These structures are relatively low cost and offer a favorable risk-reward profile if the stock gravitates toward the body of the butterfly by expiration. They also limit downside exposure while allowing for targeted participation in any re-rating sparked by stablecoin traction.

• Put calendars to anticipate headline risk without overpaying for long-term protection. If traders expect negative news or rollout delays to cause temporary setbacks, a put calendar can offer an elegant way to position for a short-term drop without committing to a long-term bearish view. The idea is to benefit from short-term volatility while managing premium outlay, especially when front-month vol is elevated but longer-dated vol remains moderate.

Watchlist summary

Final thought

Circle may be the headline-grabber, but the stablecoin economy is already powering real revenue across traditional rails. While CRCL options might be exciting, they’re also unstable. Looking one layer deeper—to Coinbase, Visa, PayPal, and others—may give traders more reliable ways to express their view using options, without stepping into the fire.