Ark Invest Researcher Doubts Open USD Can Beat Circle After 16% Stock Drop

Circle’s stock (CRCL) plunged approximately 16.5% on June 30, 2026, following the unveiling of Open USD (OUSD), a new stablecoin backed by over 140 companies including Visa, Mastercard, Coinbase, and BlackRock. CRCL closed at $63.10 after opening near $72.46, down from a prior close of $75.96. The drop extends a pullback from 2026 highs near $129, with shares losing over 40% in the last 30 days.

OUSD, developed by an independent entity called Open Standard, charges no mint or redeem fees, sets no volume caps, and shares reserve yields with its partners. A partner board governs the project instead of a single issuer. Zach Abrams, co-founder of Bridge (acquired by Stripe), leads the effort. Backers include BNY Mellon, U.S. Bank, Ripple, Google, and Shopify. OUSD is expected to launch later in 2026 on Solana, Stellar, Base, and Polygon.

Circle earns most of its revenue from interest on the Treasuries backing USDC reserves, which stand at roughly $73–$74 billion. OUSD’s yield-sharing model removes the economic incentive for businesses to tolerate Circle’s fees. Notably, Circle paid Coinbase nearly $908 million in 2024 for USDC distribution, and that agreement renews in August. Coinbase backing a rival stablecoin adds pressure to negotiations.

Lorenzo Valente, Director of Digital Asset Research at Ark Invest, expressed skepticism, comparing OUSD to past consortium attempts like Diem and the Global Dollar Network. He argued that a board representing 500 competing firms would move too slowly to challenge established issuers. Valente also questioned the funding model: at $10 billion in supply and a 25 basis point share, OUSD would generate about $25 million annually, insufficient for partner rebates and settlement infrastructure. “I’d bet on the two operators who can ship unilaterally over a committee that has to ask 500 rivals for permission,” he said.

Despite the competition, USDC retains advantages in liquidity, regulatory standing, and exchange integrations. New stablecoins have historically struggled to gain market share quickly, and OUSD is not yet live. Circle has not issued a detailed response, though CEO Jeremy Allaire has previously emphasized USDC’s reliability.

The stablecoin sector has exceeded $300 billion, with USDT near $184 billion and USDC near $74 billion. Citi projects the market could reach $4 trillion by 2030, driving payments giants and banks to back new models even before launch. Traders are focused on Circle’s upcoming Coinbase distribution deal renewal in August and any public comments from Circle as OUSD approaches launch.

Source: https://news.bitcoin.com/ark-invest-researcher-doubts-open-usd-can-beat-circle-after-16-stock-drop/