Coinbase users in Europe have shared frustration over the region’s crypto regulations after the exchange revealed it is nixing its yield offering on the dollar-pegged stablecoin USD Coin (USDC) for certain users.
In a Nov. 28 email that multiple recipients posted on X, Coinbase said due to the European Union’s Markets in Crypto-Assets (MiCA) laws for stablecoins, it “will be sunsetting the USDC rewards program” on Dec. 1.
The change will affect customers in the European Economic Area (EEA), a 30-nation bloc that includes all 27 EU member states along with Iceland, Norway and Liechtenstein. The email adds that those eligible will still accrue rewards for the next two days until Nov. 30.
“Very grateful to the EU for protecting me against earning a yield on my USDC holdings on Coinbase,” Paul Berg, the co-founder and CEO of crypto infrastructure provider Sablier, wrote in a sarcastic Nov. 28 X post.
Source: Paul Berg
“I feel protected,” Trading Strategy co-founder Mikko Ohtamaa satirically wrote on X in response to the email.
Crypto firms such as Coinbase and USD Coin (USDC) issuer Circle, which are staying in the EU, must fully comply with the MiCA laws by Dec. 30.
The laws, which entered into force in June 2023, saw a wide-ranging and strict set of rules for crypto firms and stablecoin issuers, which included a prohibition on offering interest on stablecoins, or so-called “e-money tokens.”
“It’s funny how often regulations prevent companies from doing things that are unarguably pro-consumer,” Ripple Labs technology chief David Schwartz wrote in response to Berg’s post.
Meanwhile, Tether, the issuer of the US dollar stablecoin of the same name, said on Nov. 27 that it’s dropping support for its euro-pegged token, citing “the evolving regulatory frameworks surrounding stablecoins in the European market.”
A group of former Binance executives, however, have decided to enter the market with a euro-pegged stablecoin with their firm, Schuman Financial, coming out on Nov. 26 to say its EURØP token will be live sometime in the next two weeks.
Cointelegraph has contacted Coinbase for further comment.
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