Investing.com -- Circle Internet shares fell 5% Tuesday morning after Bloomberg reported that Visa, Stripe and more than 100 other financial firms are joining forces to launch a new stablecoin venture.

The new initiative, known as Open Standard, will issue its own US dollar-backed stablecoin called Open USD, according to a blog post shared with Bloomberg News. Supporters of the venture include Visa Inc., Stripe Inc., Bank of New York Mellon Corp., BlackRock Inc., Klarna Group Plc, Chime Financial Inc., Alphabet Inc., and Coinbase Global Inc.

All partners plan to integrate the stablecoin into their systems once it goes live later this year. Zach Abrams, co-founder and CEO of Stripe-owned stablecoin infrastructure company Bridge, will serve as Open Standard’s CEO on an interim basis.

The development poses potential competition to existing stablecoin issuers. Circle’s USDC and Tether Holdings’ USDT currently account for the vast majority of stablecoin market volume. PayPal Holdings’ PYUSD, launched in 2023, remains a distant third. None of these three firms are part of the new venture.

Many Open Standard partners already use or have issued their own stablecoins. Klarna introduced its own stablecoin in November, while Mastercard Inc. acquired stablecoin infrastructure startup BVNK earlier this year.

Stablecoins have been growing in popularity in the US after President Donald Trump backed new regulations governing the payment technology. The digital currencies are pegged to another asset, often tracking the US dollar, and backed by reserves of short-term Treasuries and cash.