Open Standard, the stablecoin consortium behind OUSD, announced June 30 plans to launch the token in the second half of this year. [Image generated using ChatGPT]
Open Standard, the stablecoin consortium behind OUSD, announced June 30 plans to launch the token in the second half of this year. [Image generated using ChatGPT]

More than 140 global companies, including Visa and Mastercard, have entered the stablecoin market behind a new token called OpenUSD (OUSD). The move is drawing scrutiny over whether the venture's reserve-sharing model could undermine the business of Circle, the issuer of USDC — the world's second-largest dollar stablecoin.

Open Standard, the stablecoin consortium behind OUSD, unveiled its participant list alongside launch plans on June 30. The roster includes global heavyweights such as Visa, Mastercard, Stripe and BlackRock, as well as a wave of South Korean firms — Shinhan Financial Group, Kakao Bank, Samsung Card, Samsung Electronics and Dunamu among them.

OUSD's defining feature is its plan to share reserve income with ecosystem participants. Dollar stablecoin issuers typically invest user deposits in safe assets such as government bonds and pocket the resulting interest. Under the OUSD model, that reserve income would instead be distributed to companies that contribute to issuance, redemption, payments and corporate customer acquisition — a sharp departure from the issuer-keeps-all approach that has prevailed in the industry.

Market observers say the structure could eventually reshape the stablecoin duopoly currently dominated by Tether and Circle. Hong Jin-hyeon, a researcher at Samsung Securities, wrote in a report that OUSD "could mark a turning point in which competition in the stablecoin industry shifts from expanding issuance volume to distributing reserve income and securing networks."

Satish Patel, an analyst at CoinShares, said OUSD "could pose a direct challenge to Circle's issuer-centric revenue model," adding that its reserve-distribution structure "increases pressure on Circle to share more of USDC's reserve income with distribution partners." He noted the burden on Circle's profitability could grow further if large payments and technology companies gravitate toward a model that better aligns with their economic interests.

Markets reacted sharply to the OUSD announcement. Circle's share price fell 17.6 percent to $62.60 on June 30, as investor sentiment soured on concerns that OUSD's high-profile corporate backers would intensify competition for USDC.

Still, some analysts caution against assuming OUSD will quickly erode USDC's market share. Hong Seong-uk, a researcher at NH Investment Securities, noted that USDC already has $73 billion (about 111.69 trillion won) in circulation, making its existing liquidity and first-mover advantage difficult to dismiss.

Hong added that "how actively the partner companies will engage remains an open question," noting that the share of reserve income each firm would receive has yet to be determined and that Circle already offers incentives to its major distributors.

Whether OUSD can match USDC's open development environment across traditional finance and decentralized finance (DeFi) ecosystems also remains to be seen. Circle is currently expanding its digital financial infrastructure, including AI agent-related features, its own layer-1 blockchain called Arc, and the Circle Payments Network (CPN).

OUSD also faces significant hurdles before it can enter the market in earnest. Most key details — including the issuing entity, how licenses will be obtained and how reserve assets will be managed — have yet to be disclosed. How regulators interpret the reserve-income distribution model is also a variable that could determine the token's competitiveness.

The GENIUS Act, the US stablecoin regulatory law, prohibits structures that pay interest to stablecoin holders simply for holding the token. Discussions around the follow-on CLARITY Act have also centered on establishing clear standards to ensure that stablecoin-related rewards are not interpreted as securities or as indirect interest payments.

Hong Jin-hyeon said that "if OUSD distributes reserve income to distributors, who then pass it on to users in the form of rewards, cashbacks or deposit incentives, it is difficult to rule out the possibility that regulators would view this as an indirect interest payment," adding that "the permissible scope will need to be clarified through future legislation and regulatory guidance."

Also drawing attention is the inclusion of Coinbase, the largest US digital asset exchange, on the Open Standard participant list. Coinbase is currently a key distribution partner for Circle through the USDC business — while simultaneously joining the ecosystem of OUSD, a competing stablecoin, effectively placing bets on both sides.

Industry observers characterized Coinbase's move as a strategic hedge. Patel said the exchange has positioned itself to "maintain its USDC revenue opportunities while gaining access to a competing stablecoin ecosystem that could offer a more favorable revenue-sharing structure in the future."


kyoung@heraldcorp.com