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Open USD Consortium Unveils Yield-Sharing Stablecoin, Prompting Circle Stock Drop
When Circle’s shares slid 22 % on the day the consortium unveiled Open USD (OUSD), the market’s attention turned to a potential new rival for USDC and Tether. The announcement, made on June 30, revealed that a coalition of more than 140 companies will jointly govern OUSD and share the interest earned on its reserves.
The coalition is led by Open Standard and includes a wide spectrum of industry players—Visa, Mastercard, BlackRock, Alphabet, and Coinbase, among others. Coinbase’s participation is noteworthy, given its role as one of the original backers of USDC and its ongoing share of Circle’s revenue. The consortium’s stated aim is to launch a stablecoin that is open and interoperable across both traditional payment networks and blockchain platforms.
A defining feature of OUSD is its reserve‑yield‑sharing model. U.S. law requires stablecoin issuers to hold reserves that fully back each token in circulation, and those reserves may accrue interest. Circle has historically earned the bulk of its revenue from interest on U.S. Treasury holdings; in 2025, reserve income accounted for $2.63 billion of its $2.75 billion total revenue. Under OUSD, a portion of that Treasury income would be distributed to partners based on their holdings and the volume of OUSD they circulate, after a modest management fee—marking a departure from the traditional model used by USDC and Tether.
The market reaction has been mixed. While Circle’s stock fell sharply, analysts note that the decline may have been amplified by speculation rather than a fundamental shift in the stablecoin landscape. The stablecoin market remains dominated by USDC and Tether, and no single new entrant has yet proven it can capture a significant share of the $200 billion daily volume that flows through these tokens. Moreover, the consortium’s ability to replicate Circle’s regulatory approvals and its established payment‑network relationships remains uncertain.
Operational challenges loom as well. Coordinating governance decisions among 140 firms—many of which are banks, payment processors, and technology companies—could prove difficult. The consortium must also build the technical infrastructure to support zero‑fee minting and redemption while ensuring compliance with U.S. reserve‑backing requirements. These hurdles suggest that OUSD’s launch, slated for later this year, may face delays.
In sum, Open USD introduces a novel reserve‑yield‑sharing model and a broad partner network that could reshape the stablecoin ecosystem. However, the consortium must overcome significant regulatory, operational, and market‑acceptance challenges before it can compete with the entrenched positions of USDC and Tether.
The coalition is led by Open Standard and includes a wide spectrum of industry players—Visa, Mastercard, BlackRock, Alphabet, and Coinbase, among others. Coinbase’s participation is noteworthy, given its role as one of the original backers of USDC and its ongoing share of Circle’s revenue. The consortium’s stated aim is to launch a stablecoin that is open and interoperable across both traditional payment networks and blockchain platforms.
A defining feature of OUSD is its reserve‑yield‑sharing model. U.S. law requires stablecoin issuers to hold reserves that fully back each token in circulation, and those reserves may accrue interest. Circle has historically earned the bulk of its revenue from interest on U.S. Treasury holdings; in 2025, reserve income accounted for $2.63 billion of its $2.75 billion total revenue. Under OUSD, a portion of that Treasury income would be distributed to partners based on their holdings and the volume of OUSD they circulate, after a modest management fee—marking a departure from the traditional model used by USDC and Tether.
The market reaction has been mixed. While Circle’s stock fell sharply, analysts note that the decline may have been amplified by speculation rather than a fundamental shift in the stablecoin landscape. The stablecoin market remains dominated by USDC and Tether, and no single new entrant has yet proven it can capture a significant share of the $200 billion daily volume that flows through these tokens. Moreover, the consortium’s ability to replicate Circle’s regulatory approvals and its established payment‑network relationships remains uncertain.
Operational challenges loom as well. Coordinating governance decisions among 140 firms—many of which are banks, payment processors, and technology companies—could prove difficult. The consortium must also build the technical infrastructure to support zero‑fee minting and redemption while ensuring compliance with U.S. reserve‑backing requirements. These hurdles suggest that OUSD’s launch, slated for later this year, may face delays.
In sum, Open USD introduces a novel reserve‑yield‑sharing model and a broad partner network that could reshape the stablecoin ecosystem. However, the consortium must overcome significant regulatory, operational, and market‑acceptance challenges before it can compete with the entrenched positions of USDC and Tether.
