Coinbase Implements Fees for Converting USDC to USD

Coinbase Introduces Fees for Converting USDC to USD

Cryptocurrency exchange Coinbase has announced that it will charge a fee for converting the stablecoin USD Coin (USDC) into USD. According to a post on the exchange’s website, institutional clients making net USDC to USD conversions over $75 million within a 30-day period will be subject to fees. The fee structure is as follows: 0.1% for conversions between $75 million and $150 million, 0.15% for conversions between $150 million and $500 million, and 0.2% for conversions over $500 million.

Exemptions from Fees

Coinbase Prime clients with over $500 million of assets on the platform or holding an average of $100 million in USD/USDC over a calendar month will be exempt from the USDC conversion fees. Additionally, participants in Coinbase’s liquidity program who meet Tier 1 or Tier 2 requirements will have their conversion fees waived when they meet their monthly requirements.

Promoting USDC Over USDT

In December 2023, Coinbase encouraged customers to transfer assets from Tether (USDT) to USD Coin (USDC). The platform highlighted recent events that have tested the reliability of stablecoins and emphasized that USDC is one of the most reputable digital dollars, backed by high-quality reserves. However, Coinbase has waived USDT to USDC conversion fees for most regions in its Coinbase Simple Trade trading section to facilitate fund transfers for retail customers.

Hot Take: Coinbase Implements Fees for Converting USDC to USD

Coinbase’s decision to introduce fees for converting USDC to USD aims to generate revenue from institutional clients engaging in large-scale conversions. While this move may deter some clients, Coinbase offers exemptions for high-value clients and participants in its liquidity program. By promoting the use of USDC over USDT, Coinbase aims to establish USDC as a reliable and reputable stablecoin. However, the platform also recognizes the importance of facilitating fund transfers for retail customers by waiving conversion fees in certain regions. Overall, these measures demonstrate Coinbase’s efforts to optimize its fee structure and promote the adoption of USD Coin.