Visa (V.US) and Stripe join forces with over a hundred institutions to lay out stablecoin Circle (CRCL.US), which plunges by 17.55%.

On Tuesday, the stock price of stablecoin issuer Circle (CRCL.US) plummeted by 17.55% due to reports in the market that Visa (V.US), Stripe, and over 100 Financial Institutions, Inc. are jointly launching a new stablecoin project, potentially intensifying competition in the stablecoin market. It is reported that this new project is called Open Standard, which plans to issue a stablecoin called Open USD that is pegged to the U.S. dollar. According to public information, the institutions participating in this alliance include Visa, Stripe, New York TrustCo Bank Corp NY (BK.US), BlackRock, Inc. (BLK.US), Klarna, Chime, Alphabet (GOOGL.US) and Coinbase (COIN.US), among others. The alliance stated that Open USD is expected to be officially launched later this year, and at that time, all partners plan to integrate the stablecoin into their respective payment and financial service systems. In addition, Zach Abrams, co-founder and CEO of Bridge, a stablecoin infrastructure company under Stripe, will serve as the interim CEO of Open Standard, responsible for the initial operation of the project. Analysts believe that the establishment of Open Standard signifies a further escalation of competition in the stablecoin industry. Currently, USDC issued by Circle and USDT issued by Tether occupy the vast majority of the global stablecoin market share, while PYUSD launched by PayPal (PYPL.US) in 2023 lags far behind the other two in market size. It is worth noting that none of these three stablecoin issuers are involved in this alliance. In fact, many members who joined Open Standard have already ventured into the stablecoin business. Klarna launched its own stablecoin in November last year; MasterCard (MA.US) acquired the stablecoin infrastructure startup BVNK earlier this year to strengthen its digital payment layout. Market observers believe that unlike stablecoins issued by a single institution, Open Standard is more like an industry standard driven jointly by large payment institutions, Financial Institutions, Inc., and technology companies, with its biggest advantage being a broad payment network and application scenarios. If future partners such as Visa and Stripe fully integrate Open USD, it is expected to rapidly expand its payment and settlement usage, posing a challenge to the existing stablecoin market landscape. In recent years, stablecoins have rapidly developed in the United States, especially after the support from former President Trump to establish a regulatory framework for stablecoins, increasing market attention. Stablecoins typically anchor legal tender such as the U.S. dollar and use short-term U.S. government bonds and cash as reserves, widely used in scenarios such as digital asset trading, cross-border payments, and on-chain settlements. Analysts point out that as more large Financial Institutions, Inc. join the stablecoin market, future industry competition may shift from competing single stablecoin products to competition among payment networks, ecosystems, and application scenarios.