Key Highlights
- Open USD (OUSD) has gone live across Ethereum, Solana, Base and Tempo networks with backing exceeding $1 billion in liquidity pledges.
- Five major industry playersāCoinbase, Mastercard, Shopify, Stripe and Visaāserve as founding partners with equal ownership shares.
- The global stablecoin sector exceeds $300 billion in value, dominated by Tether’s USDT and Circle’s USDC tokens.
- Open Standard intends to allocate the majority of company equity to partners according to their contribution to OUSD expansion.
- Financial firm Mizuho reduced Circle’s stock rating in July, highlighting competitive pressure from this emerging stablecoin framework.
A fresh digital stablecoin named Open USD made its debut this week. The digital asset launched simultaneously across four blockchain networks and arrives with financial commitments surpassing $1 billion.
The organization driving this initiative is Open Standard. It enjoys backing from major industry names including Coinbase, Mastercard, Shopify, Stripe and Visa.
These five corporations constitute the founding partnership. Each member maintains an identical initial ownership position within Open Standard.
Chief Executive Zach Abrams outlined the vision driving this venture. He emphasized the team’s intention for OUSD to function as practical currency instead of serving merely as another speculative asset.
“We want to be the most useful stablecoin, the same way the U.S. dollar is useful,” Abrams said. He added that other stablecoins behave more like funds than usable currency.
Deployment Details
OUSD operates across Ethereum, Solana, Coinbase’s Base blockchain and Stripe’s Tempo network. The founding partnership intends to facilitate the token through various channels.
Certain partners might maintain OUSD holdings themselves. Others could contribute through market-making activities or integrate the token within their proprietary platforms.
Collectively, the consortium has pledged more than $1 billion toward establishing robust liquidity infrastructure for the coin. This commitment ensures adequate OUSD availability for widespread adoption.
Open Standard initially unveiled its stablecoin strategy in June. During that announcement, over 140 organizations were identified as prospective collaborators, featuring names like BlackRock, BNY and Standard Chartered.
Currently, just five entities have formalized their participation as investors. Abrams anticipates the founding coalition will expand to approximately 10 to 12 organizations eventually.
The broader ecosystem interested in utilizing OUSD has expanded beyond 200 enterprises. Recent participants include Japan’s SBI Holdings, Swiss banking institution UBS and financial technology company Jeeves.
Taking On Market Leaders Tether And Circle
The stablecoin industry presently commands a valuation exceeding $300 billion. Tether’s USDT dominates with approximately $143 billion in active supply.
Circle’s USDC holds second position with around $74 billion. Open USD joins this competitive landscape with a distinctive philosophy regarding ownership structure and incentive distribution.
Traditionally, stablecoin issuers generate revenue from interest accrued on reserve assets. Tether retains the majority of these earnings internally.
Circle distributes a fraction of its USDC proceeds to collaborators such as Coinbase. Open Standard aims to advance beyond that conventional framework.
Abrams clarified that founding stakeholders won’t receive preferential revenue allocations. Rather, they’ll obtain rewards proportional to the OUSD circulation and transaction volume they facilitate.
“The overwhelming majority of our cap table is going to be distributed back to founders and non-founders based on how they help grow the network,” Abrams said.
Open USD eliminates fees for creating or redeeming tokens. Tempo’s chief business officer, Dan Romero, indicated this approach could reduce expenses for enterprises conducting substantial value transfers.
Romero anticipates approximately $1 billion worth of OUSD on Tempo within several months. He forecasts that figure could surpass $10 billion by 2027.
Circle Encounters Analyst Scrutiny
Circle stock has experienced downward pressure following the Open USD revelation. During July, Mizuho reduced its valuation target on Circle from $85 down to $50.
The financial institution simultaneously lowered Circle’s assessment from Neutral to Underperform. Analysts identified competition from Open USD as the primary catalyst.
Mizuho increased its projection for Circle’s 2027 distribution and transaction expense ratio from 64% to 73%. The firm simultaneously decreased its adjusted earnings projection from $1.09 billion to $699 million.
Despite supporting OUSD, Coinbase, Visa and Mastercard continue their existing relationships with Circle’s USDC. Abrams mentioned Open Standard is also receiving interest for stablecoins denominated in alternative currencies, particularly from European regions.
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