Circle Stock Crashes 17% as Open USD Stablecoin Backed by Visa, BlackRock Enters the Market

Shares of Circle Internet Group (CRCL) took a significant hit on June 30th, plunging 17.5% to close at $62.63 — the steepest single-day decline the company has experienced since March. For context, that earlier March drop of 20% came in the wake of a draft legislative proposal that would have prohibited stablecoin issuers from offering yield on idle balances, sparking fears over constrained USDC adoption and weakening revenue prospects for the world's second-largest stablecoin provider.

This time around, however, the sell-off wasn't triggered by regulatory threats. Instead, investors reacted swiftly to a major new development in the competitive landscape of stablecoins.

A coalition of 140 companies — including financial and tech heavyweights like Visa, Mastercard, BlackRock, and Google — has officially announced the launch of a new dollar-pegged stablecoin called Open USD (OUSD). According to the consortium, the stablecoin is designed with a revenue-sharing model, distributing reserve earnings among member partners, while also offering zero transfer fees to users.

OUSD is primarily targeting enterprise treasury management and merchant payment solutions. Although it isn't exclusively positioned as a retail product, both of those segments overlap directly with the existing user bases of Tether's USDT and Circle's USDC — making this a direct competitive challenge to the two dominant players in the space.

The new stablecoin is expected to roll out later in 2025, but market participants didn't wait to price in the implications. Matthew Sigel, Head of Digital Assets Research at VanEck, weighed in on the development as Circle's shares slid on Tuesday, noting the stock had dropped roughly 13% as Stripe, Coinbase, and BlackRock aligned behind the competing product.

Sam Ruskin, an investment associate at Reciprocal Ventures — a crypto-focused venture capital firm — also shared a cautious view on Circle's prospects. In his assessment, Circle will likely be forced to either maintain costly revenue-sharing agreements or scramble to identify new distribution channels for USDC. Ruskin noted that nearly every major player currently interested in the stablecoin space is already backing OUSD, concluding that the situation appears structurally bearish for Circle regardless of how the dynamics unfold.

The broader stablecoin market has been experiencing heightened competition since the passage of the GENIUS Act in 2025. Tether, despite still commanding the largest share of the market, has seen its dominance slip — its market share declined from 62% to 59% over the same period, according to DeFiLlama data.

Circle, by contrast, had been on an upward trajectory, with its market share growing from 19% to 25% before settling slightly at 24% heading into 2026. Whether the introduction of OUSD will reverse that positive momentum remains an open question.

Despite the sharp selloff, Wall Street analysts have not abandoned their bullish stance on CRCL. The consensus price target among analysts sits at approximately $120 per share, representing a potential upside of around 91% from current trading levels, according to MarketBeat data.

In summary, Circle's stock suffered its worst daily performance in months as a powerful consortium of 140 firms launched a competing stablecoin with strong institutional backing. While the long-term market share impact remains unclear, near-term sentiment has shifted decidedly negative for the USDC issuer.