- Key insights: Open Standard, a stablecoin consortium with more than 140 partners, formalized its governance structure, founding partners and leadership.
- What's at stake: The update cements the stablecoin initiative as an emerging competitive threat thanks to the wide distribution network of its founding partners and its shared economics model, from which banks can earn revenue.
- Forward look: Zach Abrams, who co-founded and has been leading Bridge in addition to being interim CEO of Open Standard, will transition to be Open Standard's full time CEO.
Open Standard, the nascent stablecoin consortium with more than 140 partners across banking, payments, fintech, and crypto, took steps to formalize its governance structure, founding partners and leadership as the company prepares to issue OpenUSD later this year.
The updates formalize the initiative — which was first
"While Open Standard remains in its formative stages, today's update demonstrates increasing strategic commitment behind the initiative," Govil said. "Given the scale and distribution of its founding partners, including Coinbase, USDC's largest distribution channel, we view it as an emerging competitive threat for USDC that bears monitoring."
Coinbase, Mastercard, Shopify, Stripe and Visa were named founding partners. Those partners will invest more than $1 billion to establish OpenUSD supply, with a "limited number" of additional founding partners to be named at a later date, the company said.
The shared-economics model should also help to bolster the stablecoin, Govil said. Banks and other participants can earn equity based on the volume of activity they drive on the network.
BNY, U.S. Bank, Huntington Bank, Citizens Bank, Cross River, The Bancorp, Pathward, and Lead Bank are among the banks signed on to participate in OpenUSD. PayPal, American Express, Chime Adyen, Klarna and Affirm are also involved.
"Open Standard brings together partners who will put Open USD to work and help determine how it evolves. That shared responsibility matters when building infrastructure meant to serve businesses at scale," Shopify VP of Product, Payments, Tax, and Cross-Border Rohit Mishra said in a statement.
In addition, Zach Abrams, the co-founder of
Open Standard is looking to deploy its stablecoin for a number of use cases based on partner feedback, including settlement, institutional trading, corporate treasury, and fintech and neobank infrastructure, Abrams said in
"Stablecoins are superinfrastructure: they are as stable and reliable as cash, generate strong economics, and move over the internet like any other piece of data," Abrams said. "But while today's stablecoins look and feel like better money, in practice, they're often worse. Businesses can use stablecoins to store assets, but most can't or won't use them to transact — which is largely what they need money to do.
"If we're successful, businesses will be able to use Open USD in every way they want to use fiat today," Abrams said.
