Stablecoins are the "royalists" of the crypto world: Open USD brings the old monetary system into the fray.

null

Author: Hu Yilin

The arrival of Open USD shifts the stablecoin competition from a market battle among crypto startups to an infrastructure race involving traditional finance, payment networks, tech platforms, and public chain ecosystems. Regarding this new alliance of over 140 institutions, scholar Hu Yilin believes that stablecoins are not the moderate faction of the crypto revolution, but rather resemble the "royalist reform" within the old monetary system: they inherit the efficiency of blockchain while preserving the central role of the US dollar and the Federal Reserve. The true crypto revolution must ultimately return to a more fundamental question: does market activity necessarily depend on a central bank as the center of monetary order?

Open USD Debuts: Stablecoins Evolve from Product Competition to Alliance Infrastructure

On June 30, Open Standard announced the launch of Open USD, a US dollar stablecoin designed for global capital flows. According to official introduction, Open USD features three key designs: enterprises can mint and redeem at zero cost; reserve earnings, after deducting a small management fee, are distributed to partners; it is operated by Open Standard, an independent company, with a board composed of partners participating in governance. The participant list spans payments, banking, technology, and crypto industries, including Visa, Stripe, Mastercard, American Express, BlackRock, BNY, Standard Chartered, DBS, OCBC, Google, Shopify, Coinbase, Solana, Base, Ripple, MetaMask, Aave, and others.

The Wall Street Journal reported that Open USD plans to launch on networks such as Base and Solana later this year, with approximately 140 companies already signed up to use it. The report also noted that USDT and USDC remain the two largest stablecoins, with a combined market cap of about $260 billion. Barron’s observed that following the announcement of Open USD, stocks of companies like Circle and Coinbase came under pressure, as the new alliance directly threatens the stablecoin business model that USDC operates within.

On the surface, this represents an escalation of competition in the stablecoin industry: more enterprises joining, more channels integrated, and a redesigned mechanism for distributing reserve earnings. But in Hu Yilin's view, the greater significance of Open USD lies not in how much market share it will take from USDC or USDT, but in what it reveals about the historical position of stablecoins themselves: stablecoins have not truly challenged the dollar standard; they only make the dollar standard operate more efficiently.

Stablecoins Are Not "Moderates" but "Royalists"

Hu Yilin supports the development of stablecoins because they directly impact fiat currency and the banking system, forcing real-world political and economic structures to change. However, he emphasizes that supporting stablecoins as tools does not mean recognizing them as the completed form of the crypto revolution.

He previously compared stablecoins to the Tychonic system in the Copernican revolution: the Tychonic system absorbed many technical advantages of the new astronomy and could explain more phenomena, making it more acceptable to traditional authorities during the revolution; but it refused the core point—it would not let the Earth move. Stablecoins are the same. They inherit blockchain's settlement efficiency, programmability, global liquidity, and cross-border payment advantages, yet refuse to remove the US dollar from its central position.

Regarding Open USD, Hu Yilin further distinguishes between "moderates" and "royalists." He says: "I think someone like Michael Saylor qualifies as a 'moderate'—he also seeks compatibility with the old system, but he holds onto the core revolutionary point of the 'Bitcoin standard.'" In other words, Saylor's approach can accommodate publicly listed companies, accounting standards, debt financing, capital markets, and regulatory frameworks, but it still treats Bitcoin as the new standard asset. It compromises with the old system but does not abandon the revolutionary core that "the emperor can be replaced."

Stablecoins are different. Hu Yilin says: "Stablecoins have historical significance, but they are not true revolutionaries." In his view, stablecoins are more like reformists within the old system, believing that "the emperor (the US dollar, the Federal Reserve) is good, but the execution system below is bloated and inefficient; the previous 'Eastern Depot' did a poor job, so now our 'Western Depot' will improve things."

This metaphor sharply points out the inherent limitation of stablecoins: they oppose not the centrality of the dollar, but the inefficiency of the old payment systems, bank clearing networks, cross-border transfer systems, and financial intermediaries. They aim to replace grassroots bureaucrats, not the supreme authority.

Therefore, when the crypto revolution can only touch the "execution systems" such as banks, payment companies, SWIFT, Visa, Alipay, etc., stablecoins and the more radical cryptocurrency routes appear aligned: both oppose the expensive, slow, and opaque nature of the old financial system. But once the issue reaches the US dollar, US Treasuries, the Federal Reserve, and the fiat standard, the divergence becomes clear. Hu Yilin says that stablecoins "from the very beginning prevent the revolution from going deeper." This does not mean stablecoins have no progressive significance, but that their progressive significance is from the start confined within the old monetary order.

When the Old System Joins In, What’s Left for Stablecoin Entrepreneurs?

The uniqueness of Open USD lies in the fact that it is not a new coin launched by a single crypto startup team, but an alliance project involving payment companies, banks, tech platforms, asset management institutions, and public chain ecosystems. Open Standard officially emphasizes that it aims to give enterprises higher participation in stablecoin reserve earnings, governance, and large-scale usage.

This is exactly what Hu Yilin finds symbolic about Open USD. In the past, one core narrative of dollar stablecoins was: traditional finance is too slow, too expensive, and too closed, so crypto companies use blockchain to improve its efficiency. But now, traditional finance and payment giants are starting to organize their own stablecoin networks. The old system is no longer just an object to be reformed; it has become the initiator and governor of stablecoin infrastructure.

Hu Yilin believes this creates an irony for native stablecoin companies like Circle: if the mission of stablecoins is to serve the dollar system, be compatible with the banking system, and improve payment efficiency, then when Visa, Mastercard, Stripe, BlackRock, BNY, Google, Coinbase, and others jointly launch their own stablecoin network, the original stablecoin entrepreneurs can hardly claim they hold an irreplaceable revolutionary legitimacy.

He articulates this as a series of questions: Who exactly do stablecoins aim to revolutionize? Is it SWIFT? What if banks start using stablecoins for settlement among themselves? Is it payment networks like Visa and Alipay? What if they also accept, issue, or participate in stablecoin networks?

In his view, if the goal of stablecoins is merely to have the old system adopt blockchain payment technology, then once the old system adopts stablecoins, the stablecoin movement can declare success, and perhaps even "retire with honor." But if these native stablecoin companies are still unwilling to be co-opted, they must re-articulate their fundamental difference from the old system.

"If you still feel unwilling, you have to return to the path of decentralization, abandon compromise, and continue the revolution," Hu Yilin says.

The "drawing a clear line" here does not have to take only one form. Hu Yilin does not require all projects to follow the Bitcoin route. They can insist on a coin standard, insist on decentralized governance, insist on censorship resistance, or insist on self-custody, non-freezability, open protocols, and the right to exit. But the key is that native crypto innovators must retain some truly "disobedient" element.

"The coin standard is of course the most hardcore; emphasizing governance structure is also possible, emphasizing censorship resistance is also possible, but you must emphasize something heretical," he says.

This statement highlights the awkwardness of the stablecoin narrative: when a project bases its entire selling point on compliance, efficiency, low cost, institutional friendliness, and compatibility with old finance, it may ultimately not disrupt the old system but be absorbed by it as a new department.

The Blockchain Upgrade Package for Dollar Hegemony

Hu Yilin agrees with a more macro judgment: the more successful dollar stablecoins become, it does not necessarily mean the more successful cryptocurrency becomes—rather, it may mean the dollar system becomes more successful.

If global cross-border e-commerce, immigrant remittances, on-chain transactions, RWA, DeFi, and corporate settlements increasingly use dollar stablecoins, then what gets weakened may be local banking systems, traditional cross-border payment networks, and some capital controls, but what gets strengthened is still dollar pricing, US Treasury reserves, and the US regulatory framework.

Open USD is a concentrated embodiment of this trend. It uses blockchain as a new track for capital flows, but the unit of account remains the US dollar, the underlying earnings still come from reserve assets, and the governance structure involves corporate alliances and financial institutions. It is not an anti-dollar financial revolution; it is more like a blockchain upgrade package for dollar hegemony.

This also explains why Hu Yilin believes that stablecoins are becoming the long-term enemy of most native cryptocurrencies. The issue is not just that stablecoins take over the medium of exchange function, but that they may reshape the standard structure of the on-chain world.

If the unit of account in on-chain finance is dollar stablecoins, the collateral assets are US Treasuries and RWAs, the source of returns is traditional financial assets, and users' value anchor is also the US dollar, then the more prosperous on-chain activity becomes, it does not necessarily mean that ETH, SOL, or other underlying chain-native currencies gain more monetary premium. The on-chain world can flourish, but wealth is deposited in off-chain dollar assets, stablecoin issuers, and traditional financial return structures. In Hu Yilin's earlier words, stablecoins break the logic that "the more prosperous the chain, the more the native currency appreciates," turning it into "the more prosperous the chain, the richer the off-chain world."

"Selling fuel" is fine, but don't downgrade a civilization-level narrative to a fee narrative

The stablecoin issue also leads Hu Yilin to revisit his critique of Ethereum's "oil" narrative. Many Ethereum supporters believe that even if the chain primarily uses USDT, USDC, or Open USD, transactions still consume ETH, DeFi activities still generate fees, and L2s still settle to the mainnet, so ETH will still benefit from on-chain prosperity.

Hu Yilin's rebuttal is: fees certainly have value, but fees are not a monetary standard.

He extends the gas metaphor commonly used in the Ethereum community, but pushes it in the opposite direction. "Gas prices will not be unlimited, because when gas prices become expensive enough, people will have stronger incentives to find alternative energy sources," he says. Moreover, replacing Ethereum is much easier than replacing gasoline infrastructure. To switch a car from gasoline to electric requires new industrial chains and product designs; but migrating a DeFi protocol from Ethereum to a compatible public chain has a much lower technical barrier.

In his view, if Ethereum relies solely on fee income, it will hit the valuation ceiling of infrastructure service providers. Exchanges, clearing houses, and payment networks can be important, but their revenue scale is not equal to the monetary premium of a standard asset. Hu Yilin asks rhetorically: How much annual fee revenue does the Nasdaq exchange generate? Does the combined net income of all global stock exchanges exceed the revenue of a single Apple company?

However, he does not believe that all public chains must bear the same revolutionary mission. Chains like Solana never had such grand ambitions; their positioning is closer to "being a strong competitor at the company level," for example, as a high-performance alternative to Ethereum. Hu Yilin says that if a project's "original positioning is simply to sell fuel, then it can certainly accept that positioning." For such chains, fees, performance, ecosystem, developer experience, and application migration capabilities are the core metrics they can compete on.

The problem is that not all crypto assets can be satisfied with "selling fuel." Hu Yilin distinguishes three categories: first is Bitcoin, which from its birth was aimed at monetary revolution; second is Ethereum, which wants to be a "world computer" and a civilization-level innovation; third are many new altcoins that lack traditional capital backing and must rely on grand narratives to attract attention and trust.

Therefore, the real divergence is not whether every coin must talk about revolution, but rather: any project that aims for a higher ceiling cannot avoid a revolutionary narrative. You can be just a block space service provider, just a high-performance chain, just a financial application platform—but if you claim to change the world, restructure civilization's infrastructure, become the next currency, or the next internet, then you cannot downgrade your native currency's narrative to that of fuel for fees.

The Copernican Moment of the Crypto Revolution: The Earth Can Move

In the history of astronomy, the key to the Copernican revolution was not just that the computational model was simpler, but that people accepted a counterintuitive fact: the Earth can move, and people's daily lives do not collapse because of it.

Hu Yilin believes that blockchain and Bitcoin's monetary revolution has a similar intellectual threshold. The true Copernican moment is not when stablecoins make cross-border transfers cheaper, nor when banks learn to use on-chain settlements, but when market participants begin to realize: economic life does not necessarily need a fixed central bank as the center of monetary order.

"The key is to liberate people's thinking: the Earth can move, and my grounded life does not depend on the Earth being stationary," Hu Yilin says. Corresponding to the monetary issue, the core concept is: "Our lives, normal market transactions, do not depend on a fixed central bank; they do not require a central bank to intervene at all times to maintain market stability. What money is and how much it is worth are all determined spontaneously by the market, by each individual decentralized transaction; they do not require a specific institution to decree it."

This is also the fundamental reason he insists on the Bitcoin standard and criticizes the stablecoin standard. Stablecoins can improve efficiency, serve as transitional tools, and act as bridges between the real world and the on-chain world. But if the on-chain world is ultimately denominated in US dollars, backed by US Treasuries, and measured by central bank money as the ultimate standard of value, then the so-called "blockchain revolution" is merely an extension of the dollar system.

The arrival of Open USD precisely makes this debate clearer. It may be an important step in the commercialization, institutionalization, and scaling of stablecoins; but from the perspective of the original ideals of cryptocurrency, it may also mark a successful co-optation of blockchain technology by the old system.

Hu Yilin does not deny the historical significance of stablecoins. But historical significance is not the same as completing the revolution. The Tychonic system was once popular precisely because it could accommodate new technology and old authority; but the paradigm that truly changed the world's view was the one that allowed the Earth to move.

For the crypto world, the question is the same: if the US dollar never moves and the Federal Reserve remains at the center, then no matter how open and efficient stablecoins become, they are just precision instruments within the old universe. The real revolution will wait until the market believes that monetary order can do without revolving around that center.