Circle Stock Falls as Rivals Back Open Stablecoin

Open USD (OUSD) is a newly announced stablecoin backed by more than 140 companies, including Coinbase, Visa, Mastercard, Stripe and BlackRock, built to run as shared payments infrastructure rather than a product any single firm owns. Its unveiling has already shaken shares of Circle, the issuer of rival stablecoin USDC.

At a Glance

• Open USD (OUSD) launched by independent operator Open Standard, backed by 140plus companies
• Circle (CRCL) shares fell nearly 16% to $63.99 on the news, per Yahoo Finance
• Circle stock is now down 39% over the past month
• Businesses can mint and redeem OUSD for free with no volume caps
• Coinbase backs both Circle's USDC and the new Open USD project

Why Circle's Stock Took a Hit

Circle's shares dropped sharply the day Open USD went public, sliding to $63.99 according to Yahoo Finance. That single day loss added to a rough stretch for the company, with the stock now off 39% across the last month. The market reaction makes sense on its face: a coalition of major payment networks, a global asset manager, and even one of Circle's own close partners just put its weight behind a competing coin.

Coinbase's involvement is the part that stings most. The exchange has long been tied to Circle's USDC through a revenue sharing arrangement, yet it has also signed on as a backer of Open USD. That dual allegiance signals that even allies see value in a stablecoin structure that spreads control across many companies instead of concentrating it in one issuer.

What Open USD Is Trying to Fix

Open Standard, the newly formed entity running the project, is led by founding chief executive Zach Abrams, who previously built Bridge, a stablecoin company that Stripe later acquired. Abrams has framed OUSD as a response to persistent gripes about how stablecoins currently work: steep fees for minting and redeeming large volumes, issuers keeping the interest earned on reserve assets, and businesses having little say in how the coins they rely on are run.

Under the new model, companies can mint and redeem OUSD without fees and without caps on volume. Reserve earnings, minus a management fee, flow to the partners using the coin rather than staying with a single issuer. Control of the network rests with a board made up of representatives from partner companies, an arrangement organizers say is necessary to get widespread buy in from businesses that might otherwise be wary of depending on a competitor's infrastructure.