Coinbase helped build USDC – Why is it now backing the stablecoin trying to replace it, Open USD?
The stablecoin market has long rewarded the companies that issue digital dollars. They take in customer cash, hold reserves in short-term government securities, and earn the yield. Now, the companies that distribute those tokens want more of the economics. That tension is at the center of Open USD (OUSD), a planned stablecoin backed by more than 140 financial, technology, and crypto firms, including Coinbase, Visa, Mastercard, Stripe, BlackRock, and Google. The project promises free minting and redemption for businesses, as well as a reserve-income model that sends more value to the platforms driving adoption. For Circle, the USD Coin ($USDC) stablecoin issuer, the most important name on that list is Coinbase. The exchange helped turn $USDC into one of cryptos most widely used dollar tokens. Coinbase said in its first-quarter report that more than 25% of $USDC in circulation, or about $19 billion on average, was held across its products. It also said Base, its layer-2 network, processed 62% of global on-chain stablecoin transaction volume during the quarter. That makes Coinbase‘s support for OUSD more than a symbolic endorsement. It gives Circle’s most important distribution partner a stake in a rival model just as the economics of stablecoin issuance are becoming more contested. The cost of distribution OUSDs