The “co-op” of the stablecoin world is here: Open USD launches, and Circle responds by welcoming competition

Original Author: Shao Jiadian

Open Standard announced the launch of a new dollar stablecoin, Open USD, or OUSD. The list of participants in the announcement is impressive, including over 140 companies such as Visa, Mastercard, Stripe, American Express, BlackRock, BNY, Google, Shopify, Coinbase, Solana, and Ripple.

If it were just "another dollar stablecoin," this wouldn't be exciting. The stablecoin market has never lacked new names; what it truly lacks is liquidity, use cases, regulatory trust, and operational sustainability.

But OUSD is different. What makes it truly interesting is not that it issues another coin, but that it brings to the surface a question the stablecoin industry has rarely addressed directly:

Who should get the cut of the earnings from stablecoin reserve assets?

This is why I think OUSD is worth writing about.

Over the past few years, stablecoin issuers have taken the dollars or equivalent assets that users convert in as reserves, and those reserve assets generate interest. The main profits have gone to the issuers and a few core distribution partners. Payment companies, exchanges, wallets, merchant platforms, and developers help bring stablecoins into real-world use cases, but they may not share in sufficient economic returns.

What OUSD aims to change is this distribution logic.

Image source: Open Standard official announcement about Open USD

In layman's terms, it's like a "cooperative" in the stablecoin world: instead of one issuer taking most of the profits, it brings together payment networks, financial institutions, tech platforms, and crypto gateways to jointly promote, govern, and share the earnings.

Open USD doesn't change the technology; it changes the revenue-sharing model.

According to Open Standard's official announcement, OUSD's design has three main points.

First, enterprises can mint and redeem OUSD for free, with no artificially set size limits. For high-volume, institutional users, this directly lowers the cost of use.

Second, the income generated by OUSD's reserve assets, after deducting a small management fee, will be distributed to partners. Note here that it does not mean ordinary token holders can directly earn interest; rather, it returns the economic benefits of the stablecoin network to ecosystem participants.

Third, OUSD will be operated by Open Standard, an independent company, with a board composed of partners participating in governance. In other words, it tries to avoid having a single issuer fully control the stablecoin's roadmap, revenue model, and governance arrangements.

These three points together are where OUSD truly challenges the existing market.

Stablecoins may look like payment tools, but in essence, they are a financial infrastructure business. Users hold one stablecoin, and behind the issuance system, there is $1 in reserves. If reserve assets are invested in cash, short-term U.S. Treasury bonds, or money market instruments, they generate interest. In a high-interest-rate environment, this is a substantial income.

In the past, this income mainly belonged to the issuer. OUSD's logic is that since stablecoins rely on payment companies, merchant platforms, banks, exchanges, wallets, and developers to be promoted, these channel partners should not just be working for free.

This is no small adjustment. It directly targets the core profit of the stablecoin industry.

Why is Circle being repriced by the market?

After the OUSD announcement, Circle's stock came under pressure. The market reaction was straightforward: if payment giants, banks, tech platforms, and crypto infrastructure companies start jointly promoting a new dollar stablecoin, USDC's growth story becomes less smooth.

But Circle CEO Jeremy Allaire's response was measured. He welcomed competition while emphasizing that USDC's network effects, regulatory access, liquidity, and years of ecosystem accumulation cannot be replicated by just a flashy list.

I don't think this response is mere lip service.

What Circle really means is: stablecoins are not a launch-day business; they are a network business.

USDC wasn't built overnight. It has exchange depth, on-chain integrations, institutional clients, compliance disclosures, redemption capabilities, and a developer ecosystem. The more people use a stablecoin, the deeper the liquidity; the deeper the liquidity, the more people continue to use it. This network effect cannot be replaced by 140 logos in a day.

But the threat from Open USD is also real.

Because it's not a small company issuing a coin; it's organizing the downstream entry points for stablecoins. Behind names like Visa, Mastercard, Stripe, Shopify, Coinbase, BlackRock, and BNY are capabilities in payment clearing, merchant acquiring, consumer scenarios, crypto trading, asset management, and custody.

In the past, issuers looked for channels to distribute stablecoins. Open USD aims to have channels jointly define the stablecoin.

That's why Circle is being repriced by the market.

Circle says it welcomes competition, but the pressure won't disappear.

Circle's counterargument probably has two layers.

The first is network effects. USDC has accumulated years of market trust and real-world usage. What OUSD really needs to prove is not whether it has big-name backing, but whether these companies will actually channel real fund flows, merchant traffic, and transaction scenarios into it.

The second is the profit-sharing logic. Allaire means that Circle already distributes a large portion of its income to distribution partners while retaining enough revenue to continue investing in infrastructure. In other words, "sharing profits" is not unique to OUSD; the key is how to share, with whom, and whether the model can support long-term development.

This assessment is reasonable.

But what the market fears is not that OUSD will replace USDC tomorrow, but that the trend is shifting. In the future, banks, payment companies, fintech platforms, and merchant networks may all enter the stablecoin issuance or distribution system. As long as people start asking, "Why do I help bring users and transactions to you but can't share in more profits?" Circle's business model will face continuous scrutiny.

This is the core of the second half of the stablecoin competition.

In the first half, people asked: Who is more transparent? Who is more compliant? Whose reserves are more trustworthy?

In the second half, people will ask: Who controls the channels? Who controls the use cases? Who shares the profits?

The "cooperative model" sounds good, but history isn't always on its side.

Alliance stablecoins are not new.

The most typical example is Libra, later renamed Diem. In 2019, Facebook led a high-profile alliance to issue a global stablecoin. Its participant lineup was similarly impressive, and it also tried to put payment, tech, finance, and internet platforms into one system.

Everyone knows what happened. The project faced global regulatory crackdowns, partners withdrew one by one, governance and compliance pressures accumulated, and finally the assets were sold off, never reaching the public.

OUSD is of course not Diem. The regulatory environment and market maturity today are different. The U.S. GENIUS Act was signed into law on July 18, 2025, establishing a federal regulatory framework for payment stablecoins for the first time. Although the main obligations still need to be implemented through subsequent rulemaking, compared to Libra/Diem's time, regulatory boundaries for issuer access, reserve arrangements, anti-money laundering, and sanctions compliance are much clearer.

Image source: White House explanation of the GENIUS Act signing

But the old problems of alliance projects won't disappear automatically.

How to cold-start liquidity? How to make decisions among partners? Who is the reserve custodian? Is the redemption arrangement stable enough? Who is responsible for KYC, AML, sanctions screening, and freezing mechanisms? If interest rates fall in the future and reserve returns thin out, can free minting/redemption and partner profit-sharing be sustained?

These are the questions that truly test OUSD.

So my attitude toward OUSD is: take its model impact seriously, but don't assume its success.

It has raised a good question, but a good question is not the same as a good answer.

What Asian practitioners really need to watch is not the spectacle.

For Asian-based crypto payment, cross-border settlement, cross-border e-commerce, and Web3 companies, there are three practical takeaways.

First, the multi-stablecoin era is coming, and choosing a coin will become a compliance issue.

Previously, companies doing stablecoin payments mainly chose between USDT and USDC. In the future, as OUSD, bank-issued stablecoins, and payment institution stablecoins emerge, companies may face the need to integrate more coin types.

But integrating each new stablecoin is not just adding a payment option. Companies need to evaluate the issuer, reserve assets, redemption arrangements, freezing mechanisms, on-chain deployment, custody structure, sanctions compliance, and user terms. Choosing a coin is not just a business decision; it involves legal, financial, compliance, and risk control teams.

Second, compliance is shifting from a moat to a ticket to entry.

In the past, USDC's key selling point over USDT was its transparency, compliance, and institutional acceptance. But as the U.S. stablecoin regulatory framework becomes clearer, more banks, payment companies, and fintech firms will enter the market within the rules. In the future, all top players will talk about compliance, so compliance will no longer be a differentiating advantage for a few; it will be an entry ticket.

Third, the Asian market won't be rewritten in the short term, but enterprise settlement scenarios are worth watching.

USDT's liquidity position in Asian OTC markets and high-frequency trading scenarios won't be shaken simply because OUSD hasn't launched yet. OUSD is also not targeting retail investors; it's targeting enterprise fund flows, merchant payments, cross-border payments, and platform settlements.

If platforms like Stripe, Shopify, Western Union, and Coinbase put OUSD into their default settlement paths, those who feel the change first may not be crypto retail investors, but companies dealing with cross-border payments, overseas SaaS, cross-border trade, and crypto payments.

Conclusion

Open USD may not become a USDC killer, nor is it likely to shake USDT's global liquidity.

But it has already raised a sharp enough question: Who should share the economic benefits generated by stablecoins?

If stablecoins are just products of issuers, and reserve returns mainly belong to issuers, it makes sense logically.

But if stablecoins are becoming the underlying infrastructure of payment networks, then payment companies, merchant platforms, banks, exchanges, wallets, and developers will all demand a seat at the table.

Circle welcomes competition because it believes in USDC's network effects and compliance accumulation. Open Standard emphasizes open governance and shared returns because it sees the imbalance of interests among channel partners in the existing stablecoin model.

This competition won't be decided by announcements, nor by 140 logos. It will be decided by real fund flows, real transaction volumes, real redemption pressure, and real regulatory scrutiny.

But whether or not Open USD ultimately succeeds, it has already rewritten the way the stablecoin industry asks questions.

From now on, any issuer wanting to exclusively enjoy reserve returns must first answer a question from channel partners:

What gives you the right?