USDC seeks to be a strong competitor against USDT, which dominates the market.
Galaxy anticipates that this could be a new standard for stablecoins.
Coinbase, the world’s second-largest bitcoin (BTC) and cryptocurrency exchange, announced that Coinbase Wallet users can earn a base annual yield (APY) of 4.7% on their USDC holdings.
According to a press releasethe new function USDC Rewards allows Users earn stablecoin rewards without lock-in periods. Payments will be delivered monthly directly to wallets on the Base network.
As explained in Criptopedia, the educational section of CriptoNoticias, USDC has 1:1 parity with the US dollar and is managed and administered by Coinbase and financial services firm Circle. At the moment, ranks eighth among the most valuable digital assets with a market capitalization that exceeds $14 billion.
The option to activate USDC Rewards It is enabled in Coinbase Wallet. Only eligible users will be able to take advantage of this benefit, who are those meet a series of requirements such as having a level 2 verified account on the Coinbase exchange, having at least 1 USDC and being a resident of one of the listed countries.
In Latin America it is available in all countries except Cuba. It is also accessible from Spain. At this time, the feature is not operational in some European Union countries (such as Italy), or in Canada.
One thing to keep in mind is that APY rate is set by Coinbase and may change at any time. “We will notify you if the APY changes. Unless otherwise indicated, updates made will not take effect until the first day of the calendar month,” it is reported in the disclaimer.
Likewise, it was reported that users can also send USDC in Base instantly and without commissions. “These chain transactions are faster and more profitable than traditional methods,” the press release highlights.
With this launch, USDC seeks to establish itself as a strong competitor against USDT, the stablecoin issued by the Tether company, which currently dominates the stablecoin market.
The rewards program supports USDC balances held in Coinbase Wallet on the Ethereum, Arbitrum, Avalanche C-Chain, Polygon, and Optimism networks.
Although it is clarified that the rewards are only paid to the Base wallet address.
This initiative strengthens the idea that stablecoins like USDC They are not only a tool for payments but also an opportunity for financial growth.
Charles Yu, vice president of research at Galaxy Digital, consider that the extension of USDC Rewards to reward on-chain participants should also help bring new users to decentralized finance (DeFi) and other crypto applications. He thinks:
“Over time, if generating yield on passive stablecoin holdings becomes the new norm on-chain, we could see the rewards rate set a new floor for benchmark rates across DeFi. “DeFi markets and the broader on-chain economy could be forever changed following this pivotal moment powered by Coinbase.”
Charles Yu, vice president of research at Galaxy Digital.