Circle Shares Plunge 20%: Coinbase and Visa Take Their Stance Following New Competitor

Despite the sharp decline in Circle (CRCL) shares following the announcement of the Open USD (OUSD) project; giants like Coinbase, Visa, and Mastercard reaffirmed their commitment to the USDC ecosystem, announcing that they have adopted a multi-stablecoin strategy.

The Open USD storm in the cryptocurrency market has acted as a cold shower for Circle, one of the industry’s most established players. The project, announced about a month ago and backed by more than 140 partners including global financial giants, was perceived as a direct threat to USDC. Following this development, Circle shares lost 20% of their value, leading investors to question whether major partners had switched sides.

However, the latest earnings calls from major companies suggest that these market concerns may be exaggerated. Coinbase CFO Alesia Haas clearly stated that the terms for renewing the commercial agreement with Circle have been met and that they will continue to grow the USDC ecosystem. The company’s CEO, Brian Armstrong, noted that the platform has adopted a “multi-stablecoin” approach and that OUSD would only create new business opportunities. Similarly, Visa and Mastercard executives also emphasized that instead of picking a single winner, they aim to integrate all strong stablecoins into their networks.

Giants’ Strategy: The Era of Multi-Stablecoins

Analysts argue that OUSD partnerships are more like a “soft letter of intent” than a strategic bet. ARK Invest analyst Lorenzo Valente reminded that supporting a project is not the same as dedicating all resources to it, while Bluechip Ratings director Amey Dandawate describes this situation as a “free option.” In other words, companies are taking a seat at the table in case the project succeeds, but this does not mean they are abandoning USDC.

Visa CEO Ryan McInerney’s statement that “our role is not to pick winners” proves that the industry will be shaped by a multi-faceted structure rather than a single currency in the future. The deep liquidity and network effects possessed by established players like USDC and Tether (USDT) seem likely to continue making things difficult for new competitors.