7th July, 2026
By Cyrus Tong
On June 30, 2026, the stablecoin industry changed in a way it has not changed since Tether first issued USDT over a decade ago.
More than 140 companies (among them Visa, Mastercard, American Express, Stripe, BlackRock, Coinbase, Google, BNY, Standard Chartered, Ripple, and DBS) announced the formation of Open Standard, an independent company that will issue a new dollar-pegged stablecoin called Open USD, trading under the ticker OUSD.
The announcement sent Circle’s stock down more than seventeen percent in a single session.
The market understood immediately what the press release was careful to frame diplomatically.
Open USD is not simply a new stablecoin.
It is a direct structural challenge to the economics that have made Tether and Circle dominant, and a signal that the most powerful institutions in global payments have decided they are no longer willing to let a small number of issuers collect billions in reserve income from assets they provide.
The Economic Model That Changes Everything
To understand why Open USD matters, it is necessary to understand what it is replacing.
Tether and Circle generate their revenue primarily from the interest earned on the reserve assets backing their stablecoins, such as US Treasuries, cash, and short-term instruments held against the circulating supply.
In a high-interest-rate environment, that reserve float generates extraordinary returns. Tether reportedly generated billions in profit in 2025 from this model alone.
Circle’s entire revenue base is built around it.
The issuer collects the yield. The distribution partners, the exchanges, payment processors, and financial institutions that make the stablecoin usable collect very little.
Open USD inverts that model entirely.
Under Open Standard’s design, businesses can mint and redeem OUSD at no cost and without volume limits.
Nearly all of the reserve income generated by OUSD’s backing assets will flow back to the partner network after a small management fee, rather than to a single issuing entity.
The economic logic is deliberately constructed to align incentives.
Every partner firm now has a direct financial reason to drive OUSD adoption inside its own product ecosystem.
As the circulating supply grows, the reserve base grows, and partner earnings grow with it.
The consortium does not need to persuade its partners to adopt OUSD.
It has made their financial interests inseparable from its success.
Stripe has already announced that OUSD will become its default stablecoin for partner businesses.
Visa’s stablecoin settlement run rate had already reached approximately seven billion dollars by March 2026, with more than 160 stablecoin-linked card programmes live or in development.
The distribution infrastructure to make OUSD operationally significant exists from day one.
The Governance Structure and What It Signals
Open Standard is governed by a board made up of its partner organisations rather than by a single controlling entity.
The structure deliberately resembles a payment network, Visa or Mastercard, more than a traditional crypto issue.
This is not an incidental design choice.
It is a direct response to the critique that has followed every previous consortium stablecoin attempt, that single-issuer stablecoins carry single-issuer risk, and that the entity collecting the reserve yield will always be structurally incentivised to prioritise its own interests over ecosystem participants.
Zach Abrams, Open Standard’s founding CEO and co-founder of Bridge, the stablecoin infrastructure firm Stripe acquired for 1.1 billion dollars, framed the rationale clearly: existing stablecoins have real strengths, but enterprise users need something open, low-cost, high-throughput, and aligned to their interests at the scale of the 2040 economy, not the 2026 economy.
Whether collective governance can remain aligned as the consortium scales is the most important execution question this model faces.
The history of payment consortia is not uniformly encouraging on that point.
But the financial alignment built into the reserve-sharing model creates a structural incentive for cohesion that previous attempts lacked.
What This Means for Compliance
The Open USD launch raises compliance questions that have not yet received the attention they deserve.
The most immediate is classification.
Open USD is a consortium-issued, partner-governed, blockchain-agnostic dollar stablecoin launching initially on Solana, Base, Stellar, and Polygon.
Under the GENIUS Act’s framework, which came into force in July 2025, the question of which category of permitted payment stablecoin issuer governs a structure like Open Standard is not straightforwardly answered by the statute as currently written.
The SEC Chair has publicly stated that tokenised bank deposits are likely to be a reality in 2027, and that he is working with banking agencies on digital assets and capital requirements, a signal that the regulatory architecture around these structures is still being actively designed.
The second question concerns AML and sanctions obligations across a 140-partner ecosystem.
When more than one hundred institutions are simultaneously minting, redeeming, distributing, and settling in OUSD, the allocation of AML monitoring, suspicious activity reporting, and sanctions screening obligations across that network is not a straightforward compliance exercise.
The experience from correspondent banking, where diffuse networks of counterparties created diffuse accountability for financial crime risk, is an instructive reference point.
The third question is the UK’s FCA, which recently reduced proposed capital requirements for stablecoin issuers from two percent to one percent of total stablecoin value issued.
Whether a consortium issuer like Open Standard falls within the FCA’s framework, and how the governance structure affects the capital requirement calculation, is genuinely unclear under current proposals.
My Take
The Open USD launch is the most consequential development in the stablecoin space since the GENIUS Act was enacted.
Not because it will immediately displace USDT or USDC, the network effects embedded in existing stablecoin infrastructure are significant and will not dissolve quickly.
But it demonstrates something that compliance professionals need to internalise immediately.
The institutional adoption phase of stablecoins is no longer approaching.
It has arrived.
When Visa, Mastercard, BlackRock, BNY, Standard Chartered, Stripe, and Google commit simultaneously to the same stablecoin infrastructure, the question of whether stablecoins will become embedded in mainstream financial infrastructure is settled.
The question that remains, and that compliance functions need to be answering now, is whether the governance, AML, sanctions, and regulatory classification frameworks required to operate inside that infrastructure are being built with the same urgency.
About the author
Cyrus Tong, an award-winning compliance expert, is the Group Chief Compliance Officer of DCS Group.
