Consortium of 140+ Organizations Launches Open USD Stablecoin to Challenge USDC and Tether

Emma Newbery, The Motley Fool Sat, July 4, 2026 at 8:11 AM PDT 4 min read

There's a new stablecoin in town that wants to shake up the industry. On June 30, a consortium of over 140 organizations announced the launch of Open USD, which offers an enticing proposition for partners: joint governance, a share of the interest earned on its reserves, and free minting and redemptions.

Circle Internet Group (NYSE: CRCL), the issuer of USD Coin (USDC), saw its stock fall 22% over the 48 hours following the announcement, though it has since pared some of those losses.

The key question for investors: Is Open USD another flash-in-the-pan token, or could it genuinely challenge the dominance of USDC and Tether (USDT)?

What Is Open USD?

The Open Standard consortium plans to launch Open USD, its dollar-pegged stablecoin, later this year. The list of major companies backing the initiative is impressive and includes:

• Visa (NYSE: V)
• Mastercard
• BlackRock
• Alphabet
• Coinbase (NASDAQ: COIN)
• And more

Coinbase's participation raised particular eyebrows, given that it was one of the original forces behind USDC and still shares part of Circle's revenue.

Open USD's yield revenue-sharing model also breaks from industry norms. By law, U.S. stablecoin issuers must back each token with readily accessible reserves and can earn interest on those reserves. Circle holds the majority of its assets in U.S. Treasuries, and its reserve yield accounted for $2.63 billion of its total $2.75 billion in revenue in 2025. Investors worry that Open USD could directly challenge that revenue stream.

Is the Writing on the Wall for Circle?

In the cryptocurrency and stablecoin markets, sentiment can shift quickly — often driven by speculation. However, the dramatic drop in Circle's stock following Open USD's announcement appears overblown for a stablecoin that has not yet launched.

Open Standard will not be able to replicate Circle's regulatory progress or its payment network overnight — if at all.

On a practical level, a consortium of 140 names is impressive, but achieving consensus on key decisions will be a significant challenge. Coordinating major banks, payment processors, crypto firms, and tech companies to bring Open USD to market will require considerable behind-the-scenes effort.

Moreover, neither Tether's dominance nor Circle's first-mover advantage in the U.S. will be easy to overcome — as other high-profile stablecoin projects have discovered.

• Tether (USDT) launched in 2014 and, despite ongoing questions about its reserve management, still has $184 billion in circulation — nearly 60% of the total stablecoin market.
• Circle's USDC ranks second at $73 billion.
• Other entrants barely register. For example, PayPal launched PayPal USD in 2023 and has issued only $2.75 billion in tokens since then.

Can Stablecoins Achieve Their Potential?

The broader question is whether the stablecoin industry can grow at the rate many predict. Issuance has soared in recent years, but competition is intensifying, and regulatory hurdles remain significant.