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Coinbase will offer 4% a year return on stablecoin USDC

Coinbase announced on Tuesday that retail investors can apply to receive a 4% return on stablecoin USDC – the latest example of a crypto company offering rates that far exceed “high yield savings” accounts of the conventional banking sector.

Coinbase will offer 4% a year return on stablecoin USDC

Coinbase will offer 4% a year return on stablecoin USDC

According to the company, Coinbase customers can now subscribe to the offer, which involves purchasing USD Coin (USDC) – a blockchain-based dollar equivalent, which is guaranteed 1 to 1 for a real dollar reserve .

Although the product is essentially the same as an ordinary high-yield online savings account, Coinbase avoids the deadline for legal reasons. Specifically, Coinbase USDC accounts are not locked by the FDIC, a federal agency that guarantees the savings people put into the banks.

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  • Coinbase, however, promises “peace of mind” in the form of a company guarantee that USDC savings are safe, adding that the account offers “higher interest without higher risk”. The result is that consumers can conclude that their savings will be secure – as they believe Coinbase is solvent and properly managed.

    By offering the equivalent of a high-interest account, Coinbase is competing with companies like BlockFi, Celsius Network and Eco – all of which have jumped into consumer credit, one of the hottest fields in the crypto industry right now. In the case of BlockFi, the company is currently offering an 8.6% return on USDC and other stablecoins, including those issued by Gemini and Paxos.

    Due to regulatory restrictions, the 4% Coinbase offer will only be available in the US and will not be available in New York or Hawaii for the time being.

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