CoinDesk
Tether's USDT sits at roughly $189.5 billion in market capitalization while Circle's USDC has grown to around $71 billion — together the two issuers command the lion's share of the stablecoin universe, a concentration Ben O'Neill, head of money movement at Bridge, called "a net bad" for the sector on a Consensus Miami panel.
For O'Neill, the perspective of a large payments firm — Bridge is owned by Stripe — exposes the tradeoffs baked into both giants. Tether quotes a 10 basis-point redemption fee, "which is crazy expensive for a payments company," he said, while Circle's business model revolves around assets under management and has kept "notching up those burn fees." A card network settling trillions in stablecoin volume would face meaningful friction either way.
Why it matters
The criticism lands at a moment when stablecoins are positioning themselves as core payments infrastructure — the very use case where fee economics and redemption certainty matter most. USDT won the Chinese export trade and built what O'Neill called "this shadow economy of dollars" outside the U.S. financial system, while USDC launched in 2018 as a U.S.-regulated alternative that leaned into DeFi. Both models optimized for their original wedge, but neither was designed ground-up for high-volume, low-margin card settlement or merchant payments.
The structural risk O'Neill flags is straightforward: a duopoly that controls the on-ramps and off-ramps can keep raising fees, keep yield to itself, and "disincentivize you from burning it" — making stablecoins feel less like cash and more like a vendor relationship. His prescription is more issuers building stablecoins for specific use cases, paired with the rise of clearing-house infrastructure that lets users swap between stablecoins cheaply.
Market impact
For Tether and Circle, the critique is competitive pressure dressed as industry commentary — Stripe's Bridge processed stablecoin payment flows and has every incentive to see fee competition intensify.
Frequently asked questions
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Who is Ben O'Neill and why does his opinion on stablecoins matter?
He is head of money movement at Bridge, the stablecoin infrastructure company acquired by Stripe. His perspective carries weight because Bridge processes stablecoin payment flows for merchants and fintechs, giving him direct visibility into how issuer fee structures affect real-world payment economics.
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What are USDT and USDC's current market capitalizations?
Tether's USDT sits at roughly $189.5 billion while Circle's USDC has grown to around $71 billion, according to figures cited at Consensus Miami. Together the two issuers dominate the stablecoin sector by a wide margin.
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What specific fees did O'Neill criticize?
He singled out Tether's quoted 10 basis-point redemption fee, calling it "crazy expensive for a payments company," and Circle's pattern of "notching up" burn fees as part of its AUM-driven business model. Both create friction for high-volume settlement use cases.
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What solution did O'Neill propose for stablecoin competition?
He called for more stablecoins built for specific use cases so they can be optimized accordingly, alongside the rise of clearing-house infrastructure that makes swapping between stablecoins cheap and efficient. Without that competition, he argued, the duopoly will keep raising fees and capturing yield.
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How does this affect Tether and Circle competitively?
The critique is competitive pressure from a Stripe-owned payments firm that has incentives to see fee competition intensify. For Tether and Circle, it signals that purpose-built issuers and clearing-layer protocols are positioning to chip away at their dominance in payments-specific flows.
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