Open USD launches with 140 backers to challenge Tether and Circle

One hundred and forty financial giants backed a single stablecoin — the $200 billion digital dollar market is bracing for a new order.

On June 30, Open Standard launched Open USD, a dollar stablecoin backed by 140 financial institutions including Visa and Mastercard, entering a market where Tether and Circle control more than 90 percent of supply. The consortium-based model marks a departure from single-issuer stablecoins, pooling infrastructure across banks, payment networks and fintech firms.

"The financial plumbing of the global economy is undergoing a rewrite," according to a person familiar with the consortium's strategy who asked not to be named discussing private plans. "This is not one issuer trying to outmuscle Tether or Circle alone — it's a coordinated infrastructure play."

Open USD is issued by Open Standard, an independent company, and counts roughly 150 companies including major banks among its backers, according to the consortium's announcement. Tether's USDT commands about $120 billion in supply and Circle's USDC about $35 billion, per DefiLlama data — together representing more than 90 percent of the roughly $200 billion stablecoin market.

The entry of a consortium-backed stablecoin with Visa and Mastercard as participants could accelerate institutional capital flows into crypto rails. Tether and Circle have faced persistent regulatory scrutiny over reserve transparency — pressure that a multi-bank structure may help alleviate. The next test for Open USD will be adoption velocity: how quickly member firms route real payment volume through the new token rather than existing settlement systems.

Why the Consortium Model Matters

The stablecoin market has operated on a winner-take-most logic since 2017, with single issuers managing reserves, compliance and distribution. Open Standard's consortium model distributes those functions across its member base, potentially lowering counterparty risk for institutional users. Stripe, which has been bidding to overturn the dominance of Tether and Circle, is among the payment firms involved, according to reports. The involvement of Visa and Mastercard gives Open USD a distribution advantage that pure-play crypto issuers lack — direct access to merchant acquiring rails and bank settlement systems that process trillions of dollars annually.

What's at Stake for Incumbents

For Circle and Tether, the threat is not immediate but structural. Open USD's consortium model means that banks and payment firms that previously routed volume through USDC or USDT now have an incentive to use their own network's token. If even 10 percent of institutional stablecoin volume shifts to Open USD, that represents roughly $20 billion in supply migration based on current market size. The regulatory implications are equally significant: a consortium-backed stablecoin with major bank participation may face a smoother path to compliance under MiCA in Europe and pending US stablecoin legislation, both of which favor issuers with transparent reserve structures. Tether, which has faced questions about the composition of its reserves, could face the most pressure if regulators begin requiring consortium-style transparency as a baseline for compliance.

This article is for informational purposes only and does not constitute investment advice.