Circle Is Fighting to Defend USDC as Rivals Offer a Bigger Cut

A New Stablecoin Challenger

Circle built USDC into one of the biggest stablecoins around, but a new rival is testing just how strong that position really is. A consortium of more than 140 companies — including heavyweights like Visa, Mastercard, Stripe, and even Coinbase — launched a competing stablecoin called Open USD, and the pitch is simple: instead of Circle keeping a chunk of the yield earned on reserves, Open USD passes almost all of it straight to the distributors.

Wall Street Is Split

That's a real threat to Circle's business model, which currently keeps a meaningful share of reserve income after splitting it with partners like Coinbase and Binance. Some analysts have gotten more cautious on Circle's stock as a result, pointing to Circle's revenue-sharing deal with Coinbase as a pressure point. Others aren't convinced, arguing Circle's liquidity, regulatory head start, and network effects are hard to replace, and that consortium-led projects like this one have historically struggled to gain real traction.

Either way, stablecoin economics just got a lot more competitive.