June 30 (Reuters) – A consortium including Visa, Mastercard and Coinbase on Tuesday launched a new joint stablecoin in a bid to broaden the adoption of the digital tokens.
The venture, called Open Standard, brings together more than 140 businesses for the stablecoin network and will issue a new U.S.-dollar pegged stablecoin called Open USD, which is expected to go live later this year.
It is aimed at accelerating the usage of the digital tokens worldwide by addressing hurdles that businesses face in scaling stablecoin adoption, Open Standard said.
“Existing stablecoins have great strengths, but to use them at scale, businesses need something that’s open, low-cost, high-throughput, broadly accessible, and aligned to their interests,” Open Standard founding CEO Zach Abrams said.
It will let businesses mint and redeem Open USD without any cost and limits on volumes to help them build for scale. Earnings from Open USD’s reserves backing the digital token will also be shared among the initiative’s partners, minus a management fee to cover operational costs.
Stablecoins are digital tokens designed to keep a constant value and backed by traditional currencies such as the U.S. dollar or euro.
U.S. President Donald Trump last year signed the GENIUS Act into law, setting federal rules and guidelines for stablecoins.
This U.S. law, the first designed to facilitate crypto usage, was thought to pave the way for the digital assets to become an everyday way to make payments and move money, experts said at the time.
Still, stablecoins are mostly used to facilitate trading in other crypto tokens and are still not widely used to send or receive payments.
“A stablecoin with neutral governance and shared economics is a unique combination that has potential to unlock the next phase of digital assets growth,” BNY chief product and innovation officer Carolyn Weinberg said.
Some fintech and crypto firms had also come together in 2024 to launch a global stablecoin network called Global Dollar Network.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Devika Syamnath)
Comments