Mizuho: The passing of the Clarity Act will intensify competition for stablecoins and have a negative impact on Circle

Mizuho analysts say that if the US Clarity Act is passed, regulatory clarity will attract large institutions to enter the stablecoin market, accelerate commodification, and erode Circle's USDC revenue space. Mizuho believes that Circle is facing pressure from the Open USD project, which is supported by alliances such as Visa, Mastercard, Stripe, BlackRock, and Coinbase. The project adopts a model of distributing reserve earnings to distributors, which is different from Circle's model of retaining 38% USDC reserve earnings. Coinbase, as the largest distributor of USDC and also supports Open USD, may gain stronger bargaining power when renegotiating the revenue sharing agreement with Circle next month.