Open Standard launched Open USD (OUSD) on June 30, 2026, backed by a consortium of over 140 partners including Visa, Mastercard, Stripe, Coinbase, and BlackRock. The stablecoin introduces a 'reserve revenue sharing' model that passes yield from reserves to distribution partners and potentially end users — a direct challenge to the way Circle's USDC currently works.
How Open USD's revenue sharing works
Most stablecoin issuers, including Circle with USDC, keep the bulk of income earned from the reserves backing their tokens. Some offer selective rebates to partners. Open USD flips that. It's designed to systematically share reserve yield with the exchanges, wallets, and payment processors that distribute the token. That means partners get a cut of the revenue every time someone holds or uses OUSD, not just a one-time fee.
In the months before the launch, wallets and processors were actively asking for a share of reserve yield, according to people familiar with the discussions. Some were offered better economics to pilot OUSD. The consortium's size — 140-plus companies — gives Open USD immediate distribution reach and negotiating power.
Circle's stock takes a hit
Circle's stock price dropped in the mid-teens intraday after the announcement. Mizuho Securities downgraded the company to 'underperform' and slashed its price target from $85 to $50. The firm also cut its 2027 adjusted EBITDA forecast to $699 million, citing Open USD's distribution economics as a direct competitive threat.
The math is straightforward: if distribution partners can earn a recurring yield from OUSD, they have a financial incentive to push that token over USDC. Circle's current model keeps most reserve income in-house, with only selective partner rebates. That gap could widen as more partners demand a piece of the yield.
Why distribution partners have leverage
Exchanges, wallet providers, and payment processors control access to millions of users. That gives them leverage. They can choose which stablecoin to list, promote, or integrate. If one token offers better economics, they can shift — and they've shown willingness to do so. The pilot programs for OUSD, where some partners got better terms, signal that the market is already moving.
Open USD's yield pass-through could pressure Circle's margins if it becomes the market standard. To keep distribution, Circle may have to offer similar terms, which would eat into its own revenue. Mizuho's downgrade reflects that risk.
Circle hasn't announced any changes to USDC's revenue sharing model. But the pressure is building. The question now is whether Circle will adjust its own terms to retain partners, or risk losing distribution to a token that gives them a direct cut of the yield. With Open USD already live and backed by a consortium of major financial players, the stablecoin market just got a lot more competitive.
