In brief
- More than 140 companies have teamed up and revealed Open USD, a new stablecoin run by an independent operator called Open Standard.
- It promises free, uncapped minting/redemption, reserve earnings shared with partner businesses (minus a small fee), and governance by a board of partner companies.
- Circle’s stock price has plunged nearly 16% on the day following the announcement.
Coinbase, Visa, Mastercard, Stripe, BlackRock, and more than 140 other companies have banded together to launch a new stablecoin called Open USD (OUSD), in a bid to create shared digital payments infrastructure that no single firm controls.
The news appears to have rocked the stock price of USDC stablecoin issuer Circle (CRCL), with shares falling nearly 16% on the day to a recent price of $63.99, per Yahoo Finance. That’s pushed the firm’s plunge to 39% in the last month. Coinbase is a key ally of Circle, but has also thrown its weight behind Open USD.
The coin, unveiled Tuesday by a newly formed independent operator called Open Standard, is designed to address complaints that have dogged the stablecoin industry as it has grown: high fees for minting and redeeming tokens at scale, issuers that pocket the interest earned on reserves, and a lack of input from the businesses actually using the coins.
Open Standard—which is led by founding CEO Zach Abrams, who previously founded Stripe-acquired stablecoin company, Bridge—said that businesses will be able to mint and redeem Open USD for free with no volume caps. Partners, rather than the issuer alone, will collect the earnings on reserves, minus a management fee.
Governance will sit with a board drawn from Open USD’s partner companies rather than a single corporate parent, an arrangement organizers describe as essential to winning broad adoption.
“Existing stablecoins have great strengths, but to use them at scale, businesses need something that’s open, low-cost, high-throughput, broadly accessible, and aligned to their interests,” said Abrams, in a statement.
The backer list spans payments giants such as Visa, Mastercard, and American Express, banks including BlackRock, BNY, and Standard Chartered, tech firms such as Google and Shopify, and crypto players like Coinbase and Ripple.
Executives framed the effort as an attempt to build neutral infrastructure akin to the early internet. BlackRock’s Samara Cohen called it “a constructive step toward giving businesses more choice,” while BNY projected the broader stablecoin market could swell to $1.5 trillion by 2030.
Open USD is expected to go live later this year.
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