IBM’s Blockchain Patent Sale to Circle Offers a Rare Bright Spot After a Historic Rout
Published on 07/29/2026 at 08:02 | Redaktion boerse-global.de
IBM shares climbed 5.61% on Tuesday to close at €200.15, extending a rebound that has now reached 10.82% over the past week. The catalyst came from an unexpected corner: Circle Internet Group, the issuer of the USDC stablecoin, has acquired a substantial portion of IBM’s blockchain patent portfolio.
The deal, announced on July 27, covers more than 680 patent families and nearly 1,000 granted patents worldwide. The technologies span blockchain fundamentals, banking, insurance, supply-chain verification, and secure cloud operations. Circle said the acquisition makes it the largest holder of blockchain patents in the United States, bolstering its USDC, Circle Payments Network, and Arc enterprise blockchain projects. Financial terms were not disclosed.
The transaction marks a strategic pivot for IBM, which as recently as December 2025 held 790 US blockchain patents — more than four times the count of Bank of America, the next-closest American company. By monetizing a technology it spent over a decade building, IBM has generated a rare positive headline in a month dominated by far less cheerful news.
That news began unfolding on July 14, when CEO Arvind Krishna warned that the second quarter would come in “worse than expected.” The warning triggered a 25.2% single-day crash — the largest in IBM’s 115-year history, surpassing even the Black Monday rout of October 1987. The plunge erased more than $68 billion in market capitalization in a single session.
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Krishna attributed the miss to delayed customer spending, explaining that corporate clients had redirected quarterly budgets into servers, storage, and memory chips to hedge against expected hardware price increases amid supply constraints. IBM had anticipated some supply-chain disruption, he said, but not the magnitude of the budget shift that materialized.
When the full quarterly results were released a week later, the numbers confirmed the damage. Revenue came in at $17.16 billion against analyst expectations of $17.58 billion. Adjusted earnings per share of $2.93 missed the $2.97 consensus. The infrastructure division, home to the flagship IBM Z mainframe line, shrank 7% to $3.84 billion, with mainframe revenue alone collapsing 42%. IBM cut its full-year constant-currency revenue growth forecast to a range of 4% to 5%, down from its earlier guidance of “more than 5%.”
The scale of the selloff has drawn scrutiny from multiple law firms. Hagens Berman announced an investigation on July 28, focusing on whether IBM and Krishna misled investors about the mainframe business. The firm points to the stark contrast between the company’s upbeat April 22 report — when infrastructure grew 15%, hybrid infrastructure 28%, and IBM Z 51% — and the July 14 reversal. Bleichmar Fonti & Auld (BFA Law) had already launched a similar probe on July 24, examining whether IBM misrepresented the pace of large deals and the outlook for its Z mainframes.
Krishna and CFO Jim Kavanaugh have pushed back against the narrative that customers are abandoning mainframes. “We see no signs that customers are moving away from the mainframe,” Kavanaugh told Yahoo Finance, arguing that the weakness reflects a temporary shift in capital spending toward AI infrastructure rather than a structural decline.
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Wall Street remains divided. Several banks have cut their price targets without changing their ratings: Susquehanna lowered its target from $303 to $225 (Neutral), Goldman Sachs from $335 to $270 (Buy), Morgan Stanley from $293 to $190 (Equal Weight), and BMO Capital from $270 to $230 (Market Perform). Stifel’s David Grossman sees the stock “still in a sideways range with a slight downward bias given low near-term visibility and seasonal effects.” HSBC downgraded IBM to Reduce, while Bank of America maintained its Buy rating, arguing the company is “well positioned” once execution issues are resolved.
Despite the recent recovery, the stock remains deeply in the red. Year-to-date, IBM has lost 23.21%, and it still trades 31.85% below its 52-week high of €292.85, reached in early June. The blockchain patent sale to Circle provides a welcome distraction from the mainframe and software woes that have dominated headlines since mid-July — but whether it marks more than a single good trading day will depend on IBM’s ability to demonstrate stability in its core businesses over the coming quarters.
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