Key Highlights
- Open USD (OUSD) has debuted across Ethereum, Solana, Base, and Tempo networks with commitments exceeding $1 billion in liquidity support.
- Five equal founding partners include Visa, Mastercard, Stripe, Coinbase, and Shopify, each with identical equity positions.
- The global stablecoin sector exceeds $300 billion in value, dominated by Tether’s USDT and Circle’s USDC.
- Open Standard intends to allocate the majority of its equity ownership to partners according to their contribution to OUSD expansion.
- Investment firm Mizuho reduced Circle’s stock rating and price target in July, pointing to competitive threats from this emerging stablecoin structure.
This week witnessed the debut of a fresh stablecoin named Open USD. The digital currency went live across four separate blockchain networks and arrives with backing that surpasses $1 billion.
The organization responsible for this digital asset is Open Standard. The initiative has garnered support from major corporations including Coinbase, Mastercard, Shopify, Stripe, and Visa.
All five entities serve as founding partners, with each maintaining an identical initial ownership percentage in Open Standard.
CEO Zach Abrams outlined the vision driving this initiative. According to him, the objective centers on making OUSD function as practical currency instead of merely serving 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 Strategy and Network Expansion
The OUSD token currently operates on four blockchain platforms: Ethereum, Solana, Coinbase’s Base infrastructure, and Stripe’s Tempo infrastructure. Each founding partner has committed to supporting the token through various mechanisms.
Certain partners may acquire OUSD holdings directly. Alternative approaches involve facilitating trading liquidity or integrating the stablecoin within their proprietary platforms.
Collectively, these organizations have pledged more than $1 billion specifically for establishing robust liquidity infrastructure. This ensures sufficient token availability for widespread adoption and transactions.
Open Standard initially revealed its stablecoin strategy in June. The announcement included a network of over 140 potential partner companies, featuring prominent names like BlackRock, BNY, and Standard Chartered.
Currently, just five organizations have formalized their investor status. Abrams anticipates the founding coalition will expand to approximately 10 to 12 enterprises eventually.
Meanwhile, the broader ecosystem of companies interested in utilizing OUSD has surpassed 200 participants. Recent additions encompass SBI Holdings from Japan, Swiss banking institution UBS, and financial technology company Jeeves.
Taking On Market Leaders Tether and Circle
Today’s stablecoin marketplace commands a valuation exceeding $300 billion. Tether’s USDT maintains market leadership with approximately $143 billion in outstanding supply.
Circle’s USDC ranks second with around $74 billion in circulation. Open USD distinguishes itself through an alternative framework for ownership distribution and financial incentives.
Traditional stablecoin providers generate revenue from interest earned on their reserve assets. Tether typically retains the vast majority of these earnings internally.
Circle allocates a percentage of USDC-generated revenue to strategic partners such as Coinbase. Open Standard aims to establish a significantly more generous distribution model.
According to Abrams, founding partners won’t receive preferential revenue allocations. Their compensation structure ties directly to their contribution toward expanding OUSD adoption and transaction volume.
“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 operates without imposing minting or redemption fees. Dan Romero, Tempo’s chief business officer, highlighted how this structure could reduce expenses for enterprises transferring substantial capital.
Romero anticipates approximately $1 billion worth of OUSD circulating on Tempo in the coming months. His projections suggest this figure could exceed $10 billion by 2027.
Circle Stock Experiences Valuation Headwinds
The Open USD launch has already impacted Circle’s market valuation. During July, financial institution Mizuho slashed its Circle price target from $85 down to $50.
The firm simultaneously downgraded Circle’s investment rating from Neutral to Underperform. Their analysis identified competitive pressure from Open USD as the primary catalyst.
Mizuho increased its projection for Circle’s 2027 distribution and transaction expense ratio from 64% upward to 73%. The firm also reduced its adjusted earnings projection from $1.09 billion to $699 million.
Notably, while supporting OUSD development, Coinbase, Visa, and Mastercard continue maintaining their existing partnerships with Circle’s USDC product. Abrams mentioned that Open Standard is receiving inquiries regarding stablecoins denominated in alternative currencies, particularly from European financial markets.
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