Visa and Mastercard Launch Open USD: The Stablecoin Challenging Circle and Tether

What happened?

On July 15, 2026, a consortium of more than 140 financial and technology companies, including Visa, Mastercard, Stripe, and Coinbase, officially launched Open USD (USD0), a stablecoin pegged to the US dollar. The digital currency is managed by Open Standard, an independent organization created specifically for this purpose. According to The Next Web, the launch represents a direct challenge to the duopoly of Circle (issuer of USDC) and Tether (USDT), which currently dominate the stablecoin market with a combined market cap of over $150 billion. This event does not come out of nowhere: since 2023, Visa and Mastercard have experimented with blockchain settlement solutions, but always as intermediaries of existing stablecoins. Now, by co-creating their own token, they seek to capture a portion of the value generated by issuance and transaction fees, a market that has so far been dominated by Tether (USDT) with over $110 billion in market cap and Circle (USDC) with around $40 billion.

Why is it important?

Open USD is not just another stablecoin; it is the first time that such relevant players as Visa and Mastercard have joined forces to create their own token. Historically, these companies have preferred to integrate existing stablecoins into their networks, but now they seek direct control over issuance and governance rules. The initiative promises greater transparency, as Open Standard will publish periodic audits of reserves and use audited smart contracts. Additionally, being backed by a diverse consortium reduces the counterparty risk that Circle and Tether have faced in the past. For example, in 2023, Tether was fined by the CFTC for false statements about its reserves, and Circle faced liquidity issues during the Silicon Valley Bank crisis in 2023. Open USD aims to differentiate itself through a decentralized governance model: consortium members will vote on changes to rules, such as the inclusion of new collateral or adjustments to interest rates. This contrasts with the centralized model of Tether and Circle, where key decisions rest with their management teams. Furthermore, Visa and Mastercard plan to incentivize the use of USD0 in their payment networks by offering reduced fees for transactions with this stablecoin, which could accelerate adoption in e-commerce and remittances.

Consequences for the market

The immediate impact will be increased competition in the stablecoin market, which could reduce issuance and redemption fees. For users, this means more options and potentially better conditions. However, it also fragments the ecosystem: DeFi developers and payment platforms will have to decide whether to integrate USD0, USDC, or USDT. In the long term, Open USD could accelerate the adoption of stablecoins in everyday payments, especially if Visa and Mastercard incentivize its use in their networks. Nevertheless, regulatory doubts persist: although the consortium claims to comply with current regulations, the SEC and the Fed could closely scrutinize this initiative. Historically, the SEC has considered some stablecoins to be securities, as in the case of Binance USD (BUSD) in 2023. Open USD is structured as a utility token, but if the SEC classifies it as a security, it could face registration requirements. Additionally, the Stablecoin Act of 2024 (a bill not yet approved) could require issuers to have banking licenses, which would affect Open Standard. On the other hand, the entry of Visa and Mastercard could pressure regulators to clarify the legal framework, given the weight of these companies in the traditional financial system. The reaction from Circle and Tether has been swift: Circle has announced it will reduce its issuance fees by 20%, and Tether has promised greater transparency in its audits. However, both companies lack the direct backing of payment giants like Visa, which puts them at a competitive disadvantage in the retail payments segment.

What readers should know

Open USD has been available since its launch on several decentralized and centralized exchanges, such as Uniswap, Coinbase, and Kraken, and is expected to soon be integrated into Visa and Mastercard payment apps. Users should verify liquidity and support on their platforms before acquiring USD0. Additionally, it is advisable to follow news on potential regulatory actions. Meanwhile, Circle and Tether have responded by pointing out that their experience and market cap give them an advantage, but the entry of heavyweights like Visa and Mastercard changes the landscape. In a similar scenario, when Facebook tried to launch Libra (later Diem) in 2019, regulatory pressure led to its failure. However, Open USD has the backing of already regulated companies and a more flexible governance structure, which could avoid that fate. Analysts estimate that USD0 could capture between 10% and 20% of the stablecoin market within two years, if it overcomes regulatory and adoption hurdles. For investors, the stablecoin represents a diversification opportunity, but also a fragmentation risk. In summary, Open USD is not just a new token, but a strategic move by the world's largest payment networks to claim their place in the future of decentralized finance.