OUSD stablecoin is now live.
Open Standard’s Dollar stablecoin OUSD is officially available for businesses to use with the help of 4 core integration partners, including Stripe, Mastercard and BVNK, Visa, and Coinbase.
OUSD stablecoin is up and running on 4 different blockchain networks, including Ethereum, Solana, Base, and Tempo.
There is currently $468M in OUSD supply and reserves per Open Standard’s metrics. Recently, Bridge CEO Zach Abrams left to join as Open Standard’s CEO full-time.
Will OUSD Win on Stablecoin Rewards and Economics?
The latest dollar-backed stablecoin aims to compete in the market by offering better economics and incentive for participants to join in the revenue-sharing network.
Specifically, Open Standard is standing by a reduced market rate of mint and burn fees, although it remains to be seen what transaction fees are incurred by volume from participants.
Reserve management is also distributed across 3 different financial institutions, including BNY Mellon, which handles some reserves for Ripple and Circle, as well as Lead Bank and BlackRock.
BlackRock continues to be selected, echoing previous moves by other stablecoin issuers such as Ethena and Agora. In August, it announced an additional 2 tokenized money market funds.
For Open Standard, the return on those reserves is likely to substantially contrast to the business model operated by Circle and its $701M revenue mentioned in Circle’s Q2 earnings results.
Nonetheless, it does also mean that since the focus of revenue falls on mainly transaction fees, OUSD issuance may be less impact by future changes in federal rates.
The breakdown in its current stablecoin reserves are as follows: 56.3% sits in cash deposits, and 43.7% backed by short-term duration U.S. Treasuries.
How Does OUSD Scale its Distribution?
OpenStandard currently perhaps poses a threat to those stablecoin issuers managing stablecoins with a supply in the low billions – so anyone other than Tether or Circle.
This is because while the starting number for OUSD stablecoin supply only $468M, it’s the core integration partners who have some of the largest distribution networks around.
Visa and Mastercard both serve billons of cards and manage trillions of payment volumes per year for businesses in over 200 countries, so tapping OUSD to process some of those annual flows may have significant impact on the supply in the future.
One of the more important factors to consider is how truly incentivised the aforementioned distribution partners will be to scale OUSD’s growth while factoring its own strategies.
Mastercard acquired BVNK, a key component in this launch, and its SoFiUSD stablecoin settlement partnership, coupled with Visa’s Stablecoin Platform and relationship with many stablecoin-linked cards, means both have strong stablecoin roadmaps.
Likewise, Stripe’s growth in the last decade has seen an extremely strong foothold in the ecommerce and payments market. It made its intention to participate in the stablecoin space clear very early on by making a big bet and purchasing Bridge for over $1B in 2024.
For Coinbase, the narrative is more nuanced as it just renewed the Circle USDC stablecoin distribution agreement to keep the same deal going for longer. Therefore, the full extent of its loyalty to OUSD is not fully understood at this moment in time.
Additionally, the large exchange in parallel offers a white-label stablecoin issuance product to attract large company-branded stablecoins with USDC sitting underneath.
Coinbase partnered with Citi to process USDC transfers for its clients, as well as for better merchant acceptance at checkout.
The biggest threat is perhaps to similar reward-sharing stablecoin networks such as USDG, which currently sits at just over $3.14B in stablecoin supply. Nevertheless, this may take while.
