Coinbase Scraps Transaction Fees Whenever USDC Is Bought or Sold Using Fiat
Crypto News

Coinbase Scraps Transaction Fees Whenever USDC Is Bought or Sold Using Fiat

3m"
7 months ago

The exchange claims this is part of a move to boost global adoption, with research showing three times more USDC is bought with dollars than other currencies.

Coinbase Scraps Transaction Fees Whenever USDC Is Bought or Sold Using Fiat

Mục lục

Listen to the CoinMarketRecap podcast on Apple Podcasts, Spotify and Google Podcasts

Coinbase has announced that it's scrapping transaction fees whenever USD Coin is bought or sold using fiat.

The exchange claims this is part of a move to boost global adoption, with research showing three times more USDC is bought with dollars than other currencies.

It fears that the transaction fees associated with converting pounds, euros and yen into USDC "is a barrier to broader international adoption."

Coinbase went on to argue that there is "untapped potential" with this stablecoin, and it could be more practical to use than fiat in some countries with unstable currencies.

And while transfers through the legacy banking system can take multiple business days to settle, it says USDC transactions can be finalized in under an hour.

"We firmly believe that USDC and other stablecoins will play an increasingly significant role as the fiat on-ramp to the new Web3 ecosystem. Improving the ease of fiat-to-crypto transactions will pave the way for even more users to access DeFi. By owning USDC, users can interact with innovative new dApps in areas like trading, insurance, saving, lending, and borrowing, where USDC is a trusted means of exchange."

According to Coinbase, USDC ranged within $0.005 of its $1 peg more than 99.8% of the time between January 2021 and May 2022.

All of this comes as competition in the stablecoin sector continues to heat up.

Back in September, Binance announced that it would start automatically converting balances of three major stablecoins into its own dollar-backed asset: Binance USD.

As time goes on, this policy could have significant ramifications for USDC's standing in the market — and we've already started to see an impact.

Over the past three months, USDC's market cap has dwindled from $55 billion to $44 billion — but by contrast, Binance USD has grown from $18 billion to almost $22 billion.

'Coinbase Dollar'

During a Twitter Spaces over the weekend, BitBoy Crypto claimed that USDC could end up becoming a central bank digital currency by 2026.

"The U.S. digital dollar will replace the U.S. dollar as the world reserve currency. What does this do? This kicks the can of the fiat system down another 20 to 30 years."

BitBoy — whose real name is Ben Armstrong — claimed that U.S. officials believe it's OK to use the private sector to come up with a digital dollar — and there is no need to reinvent the wheel when crypto companies are creating a model for a coin that will stay valued at $1.

Armstrong went on to make the sensational, and unfounded, claim that Coinbase "is in bed with the U.S. government."

Concerns have been raised over central bank digital currencies, amid concerns they could erode privacy and cause consumer transactions to be surveilled.

Bitcoiners have frequently argued that a CBDC could be used to stop people buying cigars after 2AM, restrict purchases of flights to protect the environment, and even stop consumers from getting meat at grocery stores.

While Beijing has been clear in its intent to roll out "controllable anonymity" through the digital yuan, other countries would face careful oversight in their efforts to build a CBDC — meaning that some of the fears laid out by BTC maximalists may not be realized.

0 people liked this article