Coinbase has signed on as a launch partner for the Open USD consortium, a major stablecoin initiative including Stripe, BlackRock, Visa, and Mastercard. The move comes as the crypto exchange prepares to renegotiate its highly profitable revenue-sharing deal with Circle.
Circle's stock dropped roughly 17% on the news.
The current agreement, established in 2023, has been a financial windfall for Coinbase. The exchange keeps 100% of the interest income from USDC reserves held on its platform and takes 50% from USDC held elsewhere. Circle has reportedly paid Coinbase over $908 million in distribution fees, accounting for more than half of Circle's total revenue.
USDC, with a market cap of approximately $74 billion, is the second-largest stablecoin.
The Open USD consortium, announced June 30, 2026, offers a different model. It imposes no mint or burn fees and provides majority reserve income sharing with partners, contrasting with Circle's issuer-centric structure.
This places Circle in a difficult position. Its primary distribution partner is diversifying into a competing product just ahead of their contract renegotiation in August 2026. If Open USD offers superior economics, Coinbase gains significant leverage.
For Coinbase shareholders, this diversifies revenue away from USDC dependence. For Circle, it may force a more competitive revenue-sharing model. The August 2026 renegotiation will test whether the issuer-centric model or the consortium approach dominates the future of regulated stablecoins.