The US dollar stabilization currency project supported by Coinbase, Visa, BlackRock and others, Open USD, has been officially announced. The project was launched by the newly established independent operator, Open Standard, with the objective of establishing a digital payment infrastructure that is not controlled by a single company. After the news, the price of the Circe stock fell by almost 16 per cent that day.
Open USD attempts to respond to several of the main disputes in the current stable currency market, including the high costs of large-scale foundries and foreclosures, the fact that the revenue from the reserve is largely earned by the issuer, and the limited say in governance of enterprises that actually use the stable currency.
The Lord casts and redeems for free.
Open Standard states that the business can stage and redeem Open USD free of charge and without a trade cap. Unlike the current model, the benefits from reserve assets will be shared by partners, with only management fees charged by the operator.
According to the project sponsors, this arrangement is intended to reduce the cost of business access to a stable currency network and to improve availability in the payment scene. Open Standard, led by Zach Abrams, has been bought by Stripe Bridge, a stable currency company he previously established.
Governance to partner boards
According to the disclosure, the governance of Open USD would be the responsibility of a board of directors composed of partners and not the control of a single parent company. In the view of the organizers, such a structure would be more conducive to attracting more business access and would also reduce external concerns about excessive concentration of power to issue stable currencies.
Currently, the support list covers the payment, banking, technology and encryption industries. The public participants included Visa, MasterCard, American Express, BlackRock, BNY, Standard Chartered Bank, Google, Shopify, Coinbase and Ripple.
- More than 140 support institutions
- It's expected to go online later this year.
- Reserve proceeds will be allocated to partners
Targeting corporate payment networks
The participating agencies described the project as a more neutral stable currency infrastructure. BlackRock executive Samara Cohen stated that this would provide more options for businesses. BNY, for its part, predicts that by 2030, the overall stable currency market size could increase to $1.5 trillion.
From the market response, it is clear that investors see Open USD as a new variable in the current stable currency pattern. Circle stock prices fell significantly after the news was released, reflecting market concerns about stabilizing the distribution of the proceeds of currency issuance and changes in the competitive structure.