Open USD (OUSD) went live on Wednesday on Ethereum, Solana, Base and Tempo, backed by Mastercard, Visa and Stripe. The stablecoin is a direct shot at the market leaders Tether’s USDT and Circle’s USDC, which dominate a sector worth more than $300 billion.
Zach Abrams, the CEO, states that the project is not constructing a fund similar to every other stablecoin. Instead he says it is building money.
Founding Partners and Their Stake
Five companies founded Open Standard: Coinbase, Mastercard, Shopify, Stripe and Visa. Each holds an equal share of the startup’s original stock. The wider group of partners has swelled from over 140 to more than 200, with UBS, Japan’s SBI Holdings and fintech Jeeves recently joining the list.
According to Abrams, the “overwhelming majority” of Open Standard’s equity will ultimately be handed out to founders and other partners depending on how much they contribute to growing the stablecoin. The system rewards activity, not merely possession.
“We want to be the most useful stablecoin, the same way the U.S. dollar is useful,” Abrams said. “Every other stablecoin is building a fund. We’re building money.”
How Equity Gets Distributed
Stablecoin issuers usually collect interest on the cash and securities that back their tokens. Open Standard takes a different path. Tether keeps most of that income for itself, while Circle distributes part of its USDC reserve revenue to partners such as Coinbase.
At the heart of Open Standard’s model sits a partnership arrangement that makes shared interest the driving force. No founding partner receives a distinct portion of revenue. Instead, they gain rewards tied to how much OUSD supply they produce, using the very same system open to all other partners.
The firm also plans to distribute equity over the next 4-5 years to founders and network partners based on their contributions to OUSD’s growth. Abrams said much of Open Standard’s equity is intended to be distributed back to founders and non-founders based on how they help grow the network.
Partners who reach a certain minimum level can earn equity tied to a mix of OUSD supply and transaction volume, which gives them a reason to push the token around instead of just keeping it. The exact threshold for meeting that level was not shared.
The Competition and What It Means
Open USD enters a market where Tether’s USDT has about $143 billion in circulation and Circle’s USDC has roughly $74 billion. As banks, payment firms and fintechs crowd into the sector, competition is extending beyond simply issuing another digital dollar to distribution, liquidity and the platforms where customers actually use them.
In card settlement, foreign exchange and cross-border payments, Abrams believes stablecoins can move money faster than traditional banking rails. Open USD’s removal of minting and burning fees could save companies significant sums when they move large amounts of money in and out of stablecoins, according to Dan Romero, chief business officer at Tempo.
What the Model Actually Changes
What separates the two approaches is ownership of the value created. Open Standard distributes its equity over time to partners based on growth, rather than offering a fixed revenue share. This arrangement gives the companies driving OUSD’s progress a larger stake in the project.
The design ties the interests of everyone involved into a single measure. Those who hold, trade for, or build on OUSD all add to the same growth figure, and the equity rewards acknowledge each of their contributions.
Qivalis is one example of a shared stablecoin effort, built with backing from 37 European banks working on a euro stablecoin. Another group, made up of 21 financial institutions, including Bank of America, Citi, Goldman Sachs and UBS, is planning to create a firm that issues stablecoins for payments and digital asset transactions.
The Bottom Line
The founding partners hold the reins on the early story for Open USD, which has launched already. The real test will be whether the reward model delivers as planned in actual use.
Here is how the story stacks up:
- Open USD launches on four chains: Ethereum, Solana, Base and Tempo.
- Five founding partners each get an equal equity stake.
- Equity is distributed over 4-5 years to founders and partners based on growth.
- Rewards are tied to OUSD supply and transaction activity, not revenue shares.
There has been no testing of the model yet. Abrams wants OUSD to step back from the forefront, much the way the U.S. dollar has done. The outcome rests on whether partners follow through on the benefits they are told they will receive.
The goal has been stated plainly, and now the marketplace will determine what comes next.
Source material: “Open USD takes on Tether, Circle with a different stablecoin model that's 'building money',” CoinDesk.
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