Coinbase opens the “spending money” mode, users will get real-time interest when they hold stable currency.

If cryptocurrency holders want to make money, they must go to trade? Now on Coinbase, you don't have to trade as usual.

Starting Wednesday, customers of San Francisco-based cryptocurrency exchange Coinbase have been able to earn interest by holding a dollar-linked stable currency USDC with an annual rate of return (APY) of 1.25%.


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Paul Carterson, product manager at Coinbase, said:

“We are working hard to provide our customers with more ways to increase their wealth on Coinbase.”

“We know that one of the bad customer experiences is that you have to transfer money from Coinbase to your bank account to get a little interest on your bank account. We are trying to integrate these experiences together, but to make them cryptocurrencies Priority, and is placed on the Coinbase."

Users who hold a USDC worth more than one dollar in a Coinbase trading account will automatically start to receive returns from the account at no additional cost or expense.

All rewards earned on Coinbase can be tracked in real time and immediately used to purchase other cryptocurrencies on the exchange.

Coinbase product director Max Branzburg said:

“This user experience is really super smooth and simple. As long as you hold USDC in your account, you can start to get rewards, you can see the rewards counted in real time, so you can know how much you earned at any time. Money. You can use these rewards immediately to buy any other cryptocurrency on the platform."

When asked how Coinbase funded the program, Branzburg explained that the company would withdraw funds from different existing sources of income. “From trading, (Coinbase) hosting business, financial management, investment activities, etc.,” he said.

Branzburg said:

“We can profit from our business to reward our customers for storing assets on the platform.”

“We are fortunate to be able to do this, and this is a profitable business.”

Comparing the USDC rewards program with the existing US bank interest rates, Branzburg noted that the 1.25% dollar holding interest rate "is the national average or 15 times the rate that people can get through a (traditional) savings account."

Although this interest rate is lower than the yield offered by DeFi applications (such as Compound or dYdX), Branzburg says that for consumers, the USDC rewards program makes it easy to earn USDC interest because they no longer need to get money into it. A separate app or account.

"Especially for developing economies, let people hold the same amount of money as the dollar and get 1.25% interest per year… This is really amazing, especially in developing economies, we have seen "The demand of a large number of consumers," said Joao Reginatto, director of product management at Circle Money Financial Ventures Circle. Note: Circle has partnered with Coinbase to launch the USDC.

"The primary task"

In addition to Coinbase, Circle is currently the only entity to be approved to issue USDC.

Coinbase and Circle form the CIRCLE Alliance to promote the adoption of USDC stable currency and provide a governance framework for its continued growth.

Since September 26, 2018, the two companies have issued a total of more than $1 billion in USDC.

In addition to the USDC, Coinbase's Branzburg said similar rewards may appear on the exchange's other cryptocurrencies in the future.

“We think this is the beginning of a long-term investment that creates returns for our customers. We will continue to explore more ways to bring more returns to our customers. We are considering different assets and extending our services to different geographic locations. Continuing to create more value for our customers is always a top priority for Coinbase."