Why does Circle believe USDC has a competitive advantage?

Circle Chief Executive Officer Jeremy Allaire said USDC benefits from years of investment in liquidity, regulatory approvals, banking relationships and integrations. He argued these network effects create barriers that are difficult for new stablecoin issuers to replicate.

What is Open USD and who supports it?

Open USD is a proposed stablecoin backed by more than 140 companies, including Visa, Mastercard, Stripe, Coinbase, BlackRock and Google. The project is expected to launch later in 2026 and aims to expand competition in the stablecoin market.

Why did Jeremy Allaire question Open USD's business model?

Jeremy Allaire said permanently offering free minting and redemption while returning almost all reserve income to partners may not be sustainable over the long term. He argued that infrastructure providers require ongoing investment to maintain and expand stablecoin networks.

What does Bernstein expect from Open USD?

Bernstein said Open USD could become the first major challenger to the stablecoin market dominated by USDC and Tether. The firm also said governance, operational structure and revenue-sharing arrangements remain unresolved ahead of the planned launch.

What challenges could Open USD face after launch?

ARK Invest said Open USD will need to overcome established liquidity and adoption advantages held by USDC and Tether. According to the firm, many supporting companies already operate their own payment infrastructure or back competing stablecoin projects.

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Circle defends USDC as OUSD gains backing

Written by Brie CarterPublished Jul 2, 2026, 2:32 AM

Circle Chief Executive Officer Jeremy Allaire said USDC's established network provides a competitive advantage as Open USD prepares to enter the stablecoin market.
Open USD has secured support from more than 140 companies, while analysts at Bernstein said it could become the first significant challenger to Circle and Tether.
Industry analysts said Open USD still faces operational, governance and liquidity challenges before its planned launch later this year.

Circle Chief Executive Officer Jeremy Allaire said USDC's established network of integrations, liquidity and regulatory approvals gives the stablecoin a structural advantage over emerging competitors such as Open USD.

Allaire said stablecoin networks benefit from network effects built through long-term investment in banking relationships, compliance, liquidity and reserve management, while questioning whether Open USD's proposed model of free minting, redemption and broad revenue sharing can remain sustainable.

“Starving an infrastructure,” said Circle Chief Executive Officer Jeremy Allaire, referring to models that return almost all reserve income to partners.

Open USD, announced this week with backing from more than 140 companies including Visa, Mastercard, Stripe, Coinbase, BlackRock and Google, is expected to launch later in 2026, while Circle shares closed at US$62.63 on Tuesday before rising 2.44% to US$64.18 in premarket trading on Wednesday.

Bernstein analysts said Open USD could become the first major challenger to the Circle and Tether stablecoin market, although they said governance, operational structure and revenue-sharing arrangements remain unresolved.

ARK Invest Director of Research Lorenzo Valente said Open USD still faces significant liquidity and adoption hurdles because USDC and Tether already have established positions across the cryptocurrency ecosystem.

The growing competition reflects increasing interest from financial institutions, payment providers and technology companies seeking a larger role in regulated stablecoin infrastructure and digital payments.

Circle defends USDC as OUSD gains backing

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