Newsletter · · Ashutosh Agarwal

Visa, Mastercard and 140 Firms Launch OpenUSD to Challenge Circle - Stablecoins Eat Banking - Week of Jul 6, 2026

Stablecoins Eat Banking for the week of June 29 to July 6, 2026. A 140-firm consortium launched OpenUSD, a zero-fee stablecoin that hands reserve yield back to whoever brings the float, Circle sold off 17%, and the Clarity Act flipped from 'we have the votes' to gridlock.

Stablecoins Eat Banking

Week of Jun 29 – Jul 6, 2026: Visa, Mastercard and 140 Firms Launch OpenUSD to Challenge Circle

The week the incumbents stopped fighting stablecoins and decided to own them instead.

TL;DR

  • The empire struck back. A 140-firm consortium (Visa, Mastercard, Amex, Stripe, BlackRock, BNY, Google, Coinbase) launched OpenUSD (OUSD), a zero-fee stablecoin that hands the reserve yield back to whoever brings the float. Circle traded down ~17% on the week. The float-monetization model just got a target painted on it.
  • Clarity Act momentum snapped. Last week it was "we have the votes." This week Polymarket odds sit at ~39%, the lowest since January, and even friendly voices are describing how the bill "dies quietly and slowly." The whole listed complex trades around this, and it's fading.
  • Operators put real numbers on the table. Western Union is swapping a ~6% capital cost for a 2.5% T-bill yield across $100B+ of annual money movement; MoneyGram wired stablecoins into 5,000 US cash-out points via a Kraken deal; Robinhood switched on 7% USDG yield for 27M funded accounts.

What's New

1. OpenUSD is the most serious challenge to the issuer duopoly yet, and it's the co-option thesis made concrete. On Unchained's Chopping Block, the panel walked the roster: Visa, Mastercard, Amex, Stripe, Adyen, Fiserv, Klarna, Affirm, Ramp, Brex, Western Union, MoneyGram, Remitly, BlackRock, BNY Mellon, Standard Chartered, DBS, US Bank, BBVA, Mizuho, ICE, Google, Samsung, IBM, Shopify, MercadoLibre, DoorDash, Grab, Rakuten, plus Coinbase, Ripple, Gemini, Aave, Morpho, Stellar, Fireblocks, MetaMask and Anchorage. CEO is Zach Abrams, the Bridge founder Stripe bought. Zero mint/redeem fees, no volume caps, and members keep the Treasury yield pro-rata to the float they bring. On 0xResearch, the hosts noted the launch names alone account for "over 99% of global card networks, 70%+ of payment processors, 60%+ of merchant checkout software." Notably absent: Circle, Tether, PayPal. This is not disruption from the crypto edge, it's the incumbents absorbing the tech to commoditize the issuer.

"USDC is the product, but the business is the float. And that business is over." (a trader on The Wolf Of All Streets, on why Circle sold off.)

2. Circle got repriced in real time. On The Wolf Of All Streets, Galaxy's Alex Thorn (investor/analyst) laid out the stakes: Tether ~$180B supply, USDC ~$75B, next-largest SkyUSD ~$7B, an order-of-magnitude moat. But over 90% of Circle's revenue is float interest, and Coinbase earned ~$908M on USDC in 2024 (54% of Circle's revenue) under a deal that renews in August. Coinbase is a founding OUSD member, and its stock also fell ~5-6% on the news. The read-through: even Circle's biggest distributor is hedging the float economics.

3. Western Union quietly reframed itself as a stablecoin treasury. On Tokenized, head of stablecoins Malcolm Whitehead (operator/insider) said moving pre-funding onto stablecoins swaps a ~6% (6-8%) annual capital cost for a 2.5% T-bill yield on the same working capital, across $100B+ of annual flow and 500,000 retail locations. "20 years from now… they're a fact. It's not an innovation play." The catch he flagged: last-mile agent economics, where too many vendors "take bips."

4. MoneyGram turned its cash network into crypto's off-ramp. MoneyGram CEO Alex Holmes (operator/insider) detailed MGUSD on Stellar (issuance via Bridge/Stripe, custody via Fireblocks) and a new Kraken partnership making MoneyGram the crypto-to-cash off-ramp across ~5,000 MoneyGram and Walmart US locations. Goal: cut the 1-3% remittance send cost by 50%+ over time. Distribution, not issuance, is the scarce asset, and the legacy remitters own it.

5. Robinhood shipped yield to 27 million accounts. On Tokenized, Robinhood's Johann Kerbrat (operator/insider) launched Robinhood EARN, ~7% APY on USDG via Morpho vaults, wrapped in Lloyd's of London insurance, inside the core app, on top of the new Robinhood Chain (Arbitrum L2, mainnet live). The point: USDG passes yield to partners and users, exactly the mechanic OUSD is trying to standardize.

The Debate

Do regulated stablecoins disintermediate incumbents, or do incumbents co-opt the tech and commoditize the issuer? This week OUSD is the debate.

Co-option / incumbents win: OUSD is the whole thesis in one press release, card networks, banks and Big Tech pooling to strip the float premium out of issuance and keep it for themselves. On On The Brink, the hosts (pundits) argued "the model where the issuers keep the float revenue probably won't persist" and that a working consortium "wins 100%." On WoAS, the framing was even sharper: 140 of the planet's biggest firms are effectively betting Clarity doesn't pass, so they can keep the yield under the GENIUS Act's third-party loophole.

Duopoly survives: On Unchained, Haseeb (analyst) pushed back, stablecoins are "very sticky, they have natural network effects," and zero mint/redeem is "an advantage, but not that much of an advantage" against liquidity and ubiquity; he expects "Tether continues to rule the roost." Selini's Jordi (operator/trader) went at the plumbing: if members mint-and-keep the yield, who gets debited when a coin is burned through a different channel? The economics aren't specified.

My read: co-option is winning the narrative, but nobody's shipped a line of production code. OUSD is a bet that distribution beats incumbency in stablecoins, the exact opposite of what's held true so far. Watch the launch mechanics, not the logo wall.

Stocks in Play

  • CRCL (Circle): The week's loser. Down ~17%; excluded from OUSD; Allaire went out defending the compliance cost of "free" mint/redeem. Bull: entrenched liquidity, MiCA-compliant, Coinbase unlikely to actually leave. Bear: float economics under structural attack; the August Coinbase renewal is now a live overhang. Watch: OUSD launch terms; Coinbase deal renewal.
  • COIN (Coinbase): Conflicted. Founding OUSD member yet earns ~54% of Circle's revenue off USDC; stock down ~5-6%. Bull: wins either way, owns distribution. Bear: cannibalizing its own USDC annuity. Watch: whether it steers volume to OUSD post-August.
  • V (Visa) / MA (Mastercard): No longer QUIET. Both founding OUSD partners; Mastercard issued a supportive statement. After weeks of silence, the networks are now on offense at the settlement layer. Watch: OUSD go-live and any interchange read-through.
  • HOOD (Robinhood): Active. Robinhood Chain live, 7% USDG EARN for 27M accounts, perps. Bull: distribution + product velocity. Bear: most rails are non-US until Clarity passes. Watch: US rollout gated on legislation.
  • Tether: $180-184B supply, excluded from OUSD, still the perps/liquidity king. Gold-hoarding chatter ($125B Treasuries, ~$13B/yr interest) is [CLAIM, unverified] pundit color.
  • JPM: Mostly QUIET on Kinexys/JPMD; surfaced only via a blog post praising tokenization while declining to endorse Clarity, read as "we can already innovate under today's rules."
  • PYUSD (PayPal): QUIET / conspicuously absent from OUSD.
  • C (Citi), BAC, WFC, GS, MS, SOFI, XYZ/SQ, FI, FIS, GPN, BK, BitGo, GLXY: QUIET on their own initiatives (BNY and Fiserv appear only as OUSD names; Galaxy only via Novogratz/Thorn commentary; no Citi Token Services update).

Read-Throughs

  • Card networks / interchange: Visa and Mastercard just co-founded the thing that could undercut their own rails, a hedge, not a surrender. The interchange threat is still at settlement, but the networks now have a seat at the disintermediation table.
  • Money-center / correspondent banks: OUSD's bank roster (BNY, Standard Chartered, US Bank, BBVA, Mizuho, DBS) plus Standard Chartered's reported USDC mint/redeem in Dubai signal banks would rather issue the token than defend the deposit.
  • Payment processors / remitters: Western Union and MoneyGram are the tell, legacy distribution is the moat stablecoins can't buy, and both are monetizing float instead of being killed by it.
  • Custody / exchange infra: Anchorage's Nathan McCauley (operator) launched its 5th stablecoin (FUSD) and expects a stablecoin clearing layer to emerge, the next infra land-grab (Thinking Crypto).
  • T-bill demand: Every yield-share model (OUSD, USDG, Circle/Coinbase) still routes reserves into Treasuries; a bigger, commoditized stablecoin base means the same T-bill bid, just redistributed away from the issuers.

What Changed vs Last Week

Two clean reversals. First, Visa and Mastercard broke their silence, last week they were flagged QUIET; this week they helped found OUSD. Second, the Clarity Act flipped from "we have the votes" to gridlock: Polymarket odds are down to ~39% (lowest since January per Paul Barron), with a narrow ~4-week window and ≥7 Democrats still needed (per Discover Crypto). The USDT/MiCA cutover we flagged last week played out, USDT is now off compliant EU venues. New this week on the policy front: the Bank of England softened its stablecoin rules, dropping strict per-user caps (£20,000/individual, £10m/corporate) for a temporary £40 billion total-circulation cap per systemic coin (Tokenized). Still QUIET, again: JPMorgan's Kinexys, Citi Token Services, and any direct PayPal/PYUSD update.