The U.S. stablecoin market entered a new phase of uncertainty on Saturday after the Federal Reserve, the Office of the Comptroller of the Currency (OCC), and the Federal Deposit Insurance Corporation (FDIC) missed the July 18, 2026 deadline to finalize joint rules under the GENIUS Act. While no immediate shutdowns occurred, the delay leaves issuers like Circle operating without the federal certification needed to pitch USDC to conservative corporate treasuries, while new competitors such as Open USD add pressure to Circle’s stock.
Regulatory limbo deepens. The missed deadline means stablecoin issuers continue under existing state licenses and private attestations. Circle, which has built its public identity on compliance, cannot legally tell a treasury at a company like Walmart or Apple that USDC holds the specific federal payment-stablecoin designation Congress created. In contrast, Tether faces no equivalent wait and keeps expanding its offshore market share across Latin America and Southeast Asia. “Every month the U.S. spends without final rules is a month offshore issuers spend capturing market share the GENIUS Act was written to bring onshore,” the report noted.
The delay stems from an unresolved dispute over reserve assets. Federal Reserve Vice Chair for Supervision Michael Barr has advocated for reserves limited to short-term Treasury bills and central bank cash, while the OCC pushes to include short-term, highly rated commercial paper. Until one side concedes, the joint rule remains blocked. A second bottleneck exists at the FDIC, which has not clarified how multi-billion-dollar stablecoin deposits affect banks’ capital surcharge calculations, causing many banks to decline reserve deposits altogether.
Circle defends USDC as Open USD arrives. On the same day the deadline passed, Circle President Heath Tarbert defended the company’s long-term strategy after its stock (CRCL) fell sharply from a post-IPO peak near $260 to around $62. Tarbert said Circle is “playing the long game” and argued that USDC’s roughly $73 billion in circulation and native support across 34 blockchains create network effects “incredibly hard to replicate.” His comments came just after Open Standard launched Open USD, a stablecoin backed by over 140 businesses including Visa, Mastercard, Stripe, BlackRock, and Coinbase. Open Standard offers partners fee-free minting and redemption plus reserve earnings sharing, prompting Mizuho to cut its Circle price target to $50 on margin and distribution cost concerns.
Circle has continued expanding regulated infrastructure despite the stock decline. On July 10, the company received final OCC approval to establish Circle National Trust, a federally supervised trust bank that will initially provide digital asset custody and may later manage USDC reserves. Tarbert framed the situation as a contest for stablecoin distribution and reserve income, betting that USDC’s existing network and regulated footing will sustain its position even as the 2028 ban on non-compliant stablecoins from exchanges approaches without an extended runway.
