Circle Shares Slide as Coinbase, BlackRock and Visa Back Rival Stablecoin

The lineup is notable because several of these companies have long-standing ties to Circle. Coinbase, in particular, has been a key backer of USDC, making its support for a rival network a pointed shift in allegiances. The breadth of the coalition—spanning payments giants, asset managers and exchanges—suggests Open USD intends to position itself as an industry-wide standard rather than a single-company product.

Why the Model Matters

The competitive threat lies in how Open USD is structured. CoinDesk reported that the network aims to let participating partners retain reserve income and to eliminate minting fees. That economic model directly challenges the approach behind Circle's USDC, where revenue generated from the reserves backing the token has been central to the business.

By allowing partners to keep the yield earned on reserves and removing the cost of creating new tokens, Open USD could appeal to banks, fintechs and merchants weighing which stablecoin rails to adopt. For a sector where margins and distribution agreements determine market share, those terms represent a meaningful inducement to switch.

The market reaction was swift. CoinDesk reported that Circle's stock cratered roughly 17%, while its earlier coverage noted a decline of around 8%, underscoring how quickly sentiment moved as details of the consortium emerged. The selloff reflects investor concern that a well-funded alternative backed by Circle's own partners could erode USDC's position.

Implications for the Africa-Europe Corridor

Stablecoins have become an increasingly important tool for cross-border payments, including flows between Africa and Europe, where remittances and trade settlement often face high costs and slow processing. A competitive shakeup among dollar-token issuers could influence which networks payment providers and fintechs build on in those corridors.

If Open USD's fee structure and reserve-sharing terms gain traction, businesses operating across the two regions may find new options for moving value at lower cost. For now, much depends on execution: Open USD is still described as forthcoming, and how quickly its backers translate commitments into live infrastructure remains to be seen.

Neither Circle nor the Open Standard consortium has detailed a full launch timeline in the coverage available. As Decrypt and CoinDesk both reported, the scale of the backing alone has been enough to reshape expectations for the stablecoin market.

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