- Circle CEO Jeremy Allaire defends USDC as OUSD launches, citing decade-long network effects.
- Allaire cited Artemis data showing USDC handled nearly 80% of on-chain stablecoin transactions.
- He welcomed OUSD but questioned whether its consortium model can support long-term growth.
Jeremy Allaire, Circle co-founder and Chief Executive Officer (CEO), has addressed investor questions on the new Open USD (OUSD) stablecoin launched by a consortium, positioning it as competition while highlighting USDC’s decade-long lead. Allaire positioned stablecoins as long-term platform businesses, favoring winner-take-most dynamics while welcoming new entrants.
Circle CEO Defends USDC as OUSD Launches
On July 1, 2026, in a detailed X post, Allaire directly addressed investor questions on the newly launched OUSD stablecoin. OUSD is a dollar-pegged stablecoin launched by a consortium of over 140 firms, including Stripe, Mastercard, Visa, BlackRock, Coinbase, and others.
The launch of OUSD sparked an immediate market reaction. Circle’s stock (NYSE: CRCL) fell between 11% and 17% during the trading session as investors weighed the potential impact of the new stablecoin on USDC’s business model and long-term revenue prospects.
Why Allaire Says USDC’s Network and Liquidity Outmatch OUSD
In response, Allaire pointed out that USDC is built on a network that has been around for almost a decade, has strong liquidity, a regulatory presence, and a solid ecosystem, making it difficult for new entrants to replicate.
Allaire says USDC’s first competitive advantage is its extensive network of application and service integrations. Thousands of developers and platforms already use USDC, creating powerful network effects that attract more users. Circle further strengthens USDC’s interoperability and liquidity across blockchains and Layer 2 networks.
Additionally, USDC has the liquidity advantage, which is built over years of investing in global banking and exchanges. USDC is the third most liquid digital asset in the world, falling behind Bitcoin (BTC) and Tether (USDT). Allaire said the free mint/burn and revenue-sharing model of OUSD could restrict long-term infrastructure investment required to get to a similar scale and liquidity.
Supporting his argument, Allaire cited Artemis data showing USDC processed nearly 80% of on-chain dollar stablecoin transactions in Q1 2026, with USDT at about 20%, while all other dollar stablecoins accounted for less than 0.5%. Most alternative volume, Allaire said, stems from incentives rather than organic, sustained usage.
What’s Next for USDC and OUSD in the Stablecoin Race?
Despite criticizing key aspects of OUSD’s model, Allaire maintained a collaborative stance and said Circle expects many of OUSD’s founding members to remain USDC partners. He further reiterated the existing healthy relationship between Circle and Coinbase and the ongoing collaboration through products such as Arc, CPN, and StableFX.
As OUSD is expected to launch later in 2026, its success will depend on rapidly building liquidity, integrations, and user trust while navigating operational challenges like reserve management and compliance at scale.
Furthermore, regulatory tailwinds, including new regulations in the US, Europe, and Asia, are likely to benefit well-capitalized, compliant issuers such as Circle and could prove challenging for new entrants. Ultimately, the race will hinge on real-world usage rather than announcements.
Related: Stripe, Visa & Mastercard Back Partner-Governed Open USD Stablecoin
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