Open USD Stablecoin Set to Challenge Circle’s USDC

Open Standard, a consortium of more than 140 payments, financial and crypto companies including Stripe, BlackRock and Coinbase, unveiled OpenUSD, a stablecoin backed 1:1 by dollar reserves. Unlike the traditional issuer model, it plans to return nearly all reserve interest to network partners. That structure matters for Circle because 96% of its $2.7 billion in fiscal 2025 revenue came from reserve income, leaving the USDC issuer exposed if distributors demand a larger share of the economics.

Circle shares fell 17% on June 30 after the OpenUSD announcement, but Talos said in a July 14 research note that the equity selloff had not translated into weaker USDC network activity. USDC had a market capitalization of about $73 billion, or roughly 23% of the stablecoin market. In the first half of 2026, it settled about 79% of $38 trillion in adjusted on-chain transfer volume, with Base accounting for 69% of that total, underscoring the token’s entrenched liquidity and distribution footprint.

Circle’s exposure to USDC depends not only on issuing the dollar token but also on the distribution network around it. Coinbase, a longtime partner, held more than 25% of USDC in circulation, or about $19 billion on average, across its products in the first quarter of 2026. Open USD challenges that model by promising fee-free minting and redemption and returning most reserve income to participating businesses, raising questions about Circle’s margins and USDC’s moat.

Open Standard unveiled Open USD on June 30, 2026, with backing from more than 140 companies, including Coinbase, Visa and Mastercard. Circle shares fell nearly 16% that day to $63.99. Executives at the three backers have since framed their involvement as part of a multi-stablecoin strategy, not a withdrawal of support for USDC, and OUSD is not expected to go live until later in 2026. Analysts say adoption will hinge on execution and whether OUSD can overcome USDC’s deep liquidity and entrenched network effects.

Stablecoins maintain their value through reserves such as U.S. dollars and short-term Treasury securities, with issuers earning most of their profits from interest on those assets. The market has long been dominated by Tether’s USDT and Circle’s USDC. Open Standard plans to give participating companies governance rights and most of the reserve income, while bringing together industry heavyweights including Visa, Stripe and BlackRock in a model that could reshape how the proceeds are distributed.

Open Standard said on June 30, 2026, that more than 140 institutions supported OUSD, which is scheduled to launch later that year and will be deployed natively on Tempo. It will offer fee-free minting and redemption as well as a share of reserve income. Circle shares fell more than 16% that day. CEO Jeremy Allaire said on July 1 that USDC recorded nearly $30 trillion in onchain transactions in the first quarter. On July 3, Samsung Electronics, Upbit parent Dunamu and others denied having formally joined, raising questions about the list’s credibility.