On Tuesday, June 30, 2026, a consortium of more than 140 companies, including major financial and tech giants like Visa, Mastercard, Stripe, American Express, Coinbase, BlackRock, BNY Mellon, and U.S. Bank, announced the launch of Open USD (OUSD). This new dollar-backed stablecoin is designed with an economic model that redirects the T-bill yield, traditionally kept by the issuer, to the businesses that distribute the coin. This approach directly challenges Circle's USDC business model, where Circle retains most of the yield from its $73 billion in USDC reserves. OUSD's structure, which gives distributors all of the reserve income, is seen as a major draw for partners, contrasting with Circle's revenue-share deals, such as the one with Coinbase where Coinbase receives roughly half of the interest income USDC generates.
The launch of OUSD had an immediate and severe impact on Circle Internet Group's stock. On Tuesday, Circle's stock (CRCL) plummeted by roughly 17%, closing at $62.63 and erasing $3.3 billion from its market capitalization in a single day. This marked Circle's worst single-day drop since going public and contributed to a 40% decline in the company's value over the preceding month. Analysts and market observers characterized the OUSD launch as a "coordinated ambush" by Circle's own strategic partners, including BlackRock (Circle's primary reserve manager), BNY Mellon (Circle's primary reserve custodian), and Coinbase (Circle's largest distributor). These partners are now aligned with a direct competitor, posing a fundamental threat to Circle's business model.
Despite the significant market reaction, some analysts and Circle's CEO, Jeremy Allaire, have downplayed the long-term threat of OUSD. William Blair analysts suggested the sell-off was an overreaction, citing Circle's first-mover advantage, liquidity, and established payments infrastructure. Bernstein analysts reiterated an "Outperform" rating on Circle with a $190 price target, expressing skepticism that Coinbase would abandon USDC. Allaire himself questioned OUSD's ability to fund future infrastructure development if it gives away all income and warned that consortia have a history of rolling out underperforming products due to coordination issues. Cathie Wood's Ark Invest, in a show of confidence, purchased an additional $17.8 million worth of Circle shares across three of its ETFs (ARKK, ARKW, ARKF) on Wednesday, as the stock continued to dip.
