Coinbase announces the end of its USDC yield offerings on Dec. 1 for customers in the European Economic Area as a result of the region’s MiCA stablecoin laws.
In a Nov. 28 email circulating on X, the crypto exchange stated that it “will be sunsetting the USDC Rewards program” on Dec. 1, much to the dismay of impacted customers who have started posting reactions to the email online.
The service will end for all clients based in the European Economic Area, which consists of 30 nations, including 27 EU member states along with Iceland, Norway and Liechtenstein. Crypto.news has reached out to Coinbase for confirmation of this news but has not received a response.
Though, Coinbase does give clients who are eligible to earn USDC Rewards to accrue rewards for USDC(USDC) balances until Nov. 30 before the program is due to close. The exchange cites the incoming European Markets in Crypto-Assets or MiCA regulation that introduce new requirements for stablecoins as the reason behind the abrupt end to the firm’s USDC Rewards for EEA customers.
MICA is kicking in -> Sunsetting USDC Rewards in the EU Due to MiCA @coinbase @circle pic.twitter.com/8GCGlpt8Xd
— Marina Markezic (@MarinaMarkezic) November 28, 2024
Co-founder and CEO of token streaming protocol Sablier, Paul Berg, reacted to the email in a recent X post, stating sarcastically that he feels “very grateful to the EU” for protecting him against earning yield on USD Coin holdings on Coinbase.
Ripple Labs technology chief David Schwartz responded to Berg’s post, stating that he thought it was ironic that regulations tend to hinder companies from offering services that benefit customers.
“It’s funny how often regulations prevent companies from doing things that are unarguably pro-consumer,” said Schwartz in his post.
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MiCA’s stablecoin laws, which were introduced in June 2023, laid out a number of strict regulations and standards for crypto firms and stablecoin issuers to follow if they intend to operate in the EU, one of them is a ban on offering stablecoin interests or what is referred to as “e-money tokens.”
Crypto and stablecoin firms are expected to fully comply with the new MiCA laws by Dec. 30.
As previously reported by crypto.news in October, Coinbase had announced that it will delist non-compliant stablecoins from its European exchange by the end of this year in response to incoming MiCA regulations. One of the stablecoins due to be delisted is Tether(USDT).
On Nov. 27, Tether said it will end support for the Euro-pegged stablecoin EURT “until a more risk-averse framework is in place.” Customers with EURT balances on blockchains are given a year-long time frame to redeem their holdings until Nov. 27, 2025.
However, Tether also revealed plans to invest in Quantoz Payments to support MiCA-compliant stablecoins, EURQ and USDQ.
Read more: Tether to invest in Quantoz to support MiCA-compliant stablecoins
