Morning Edition · Sunday, July 5, 2026

A 140-Firm Alliance Backs Open USD, Targeting the Economics That Built Circle and Tether

Open USD would return reserve income to distributors rather than issuers, inverting the model that made stablecoins profitable, as Circle's shares fell about 17 percent.

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A 140-Firm Alliance Backs Open USD, Targeting the Economics That Built Circle and Tether

A consortium of more than 140 companies, including Visa, Mastercard, Stripe, BlackRock and Coinbase, has unveiled Open USD (OUSD), a dollar stablecoin explicitly designed to undercut the revenue model of the incumbents. As crypto.news and CoinDesk report, businesses will be able to mint and redeem OUSD without fees or volume limits, and most of the income earned on its reserves will flow to participating firms after a small management fee, rather than to the issuer.

That inversion directly challenges the current model. Tether and Circle keep the interest earned on the Treasury bills backing their tokens, and that income produces most of their profit. Circle's arrangement is especially exposed, because it paid Coinbase more than $900 million in 2024 to distribute USD Coin. Coinbase's decision to support a rival helps explain why Circle's stock fell roughly 17 percent on the announcement. OUSD is expected to launch later in 2026 on Solana, Stellar, Base and Polygon.

Skeptics urge caution about the coalition itself. CryptoSlate reports confusion over which of the 140-plus named partners are actually committed, the familiar question for any alliance coin. For now the total stablecoin market, at about $309.87 billion in circulation with Tether near $184.09 billion and USD Coin near $73.04 billion, remains controlled by the incumbents, and a broad distributor coalition still has to turn named partners into actual circulating supply.

Veracity: Corroborated

84/100

If true, who benefits: Payment networks and distributors that would capture reserve yield, and every party interested in compressing the margins that made Circle and Tether profitable.
The nuance: The 140-plus partner count and Circle's roughly 17 percent one-day drop are verified, but which named firms are actually committed to mint OUSD remains unconfirmed, and the token has not launched.

An open-source-intelligence read of how likely this story is true with its real nuance, not a judgment of any outlet. It assesses the claim, weighing independent and adversarial reporting. How we label confidence.

What this means

Stablecoin economics have depended on issuers keeping the yield on reserves while paying distributors for access to customers. A credible coalition that returns that yield to distributors would compress issuer margins across the sector and shift power toward the payment networks and banks that own the customer relationship. It is a direct challenge to the sound-money critique that stablecoin profit is a hidden tax on holders, who receive none of the interest their dollars earn.

What to watch

Whether OUSD reaches meaningful circulating supply after launch, the only measure that separates a press release from a real competitor.
Whether Tether and Circle begin sharing reserve yield to defend distribution, which would confirm margin compression is underway.

Observations to monitor, not financial advice.

3 sources

Synthesized from: crypto.news · CoinDesk · CryptoSlate

Part of a tracked trend

Race to Bank and Distribute Stablecoin Reserves

Over 3-6 months, established financial and payments firms compete to custody stablecoin reserves and embed stablecoin rails into cross-border settlement, institutionalizing the plumbing beneath stablecoins.