Coinbase has announced that it will end its USDC yield offerings on December 1 for customers in the European Economic Area. This is because of the region’s MiCA stablecoin laws.
On November 28, an email was circulating on X. In that email, the crypto exchange said it “will be sunsetting the USDC Rewards program” on December 1. Many affected customers are dismayed. They’ve started posting their reactions to the email online.
The service will stop for all clients in the European Economic Area. This area has 30 nations. It includes 27 EU member states, plus Iceland, Norway, and Liechtenstein. Crypto.news tried to reach out to Coinbase to confirm this news, but hasn’t got a response yet.
However, Coinbase does let clients who are eligible to earn USDC Rewards accumulate rewards for their USDC balances until November 30 before the program closes. The exchange says the reason for suddenly ending the USDC Rewards for EEA customers is the incoming European Markets in Crypto-Assets or MiCA regulation. This regulation brings new requirements for stablecoins.
Paul Berg, the co-founder and CEO of token streaming protocol Sablier, reacted to the email in a recent X post. He said sarcastically that he’s “very grateful to the EU” for stopping him from earning yield on his USD Coin holdings on Coinbase.
David Schwartz, the technology chief at Ripple Labs, responded to Berg’s post. He said it’s ironic that regulations often stop companies from offering services that are good for customers. He said, “It’s funny how often regulations prevent companies from doing things that are unarguably pro-consumer.”
MiCA’s stablecoin laws were introduced in June 2023. They set a number of strict regulations and standards for crypto firms and stablecoin issuers. If these firms want to operate in the EU, they have to follow these rules. One of the rules is a ban on offering stablecoin interests, also called “e-money tokens.”
Crypto and stablecoin firms are supposed to fully comply with the new MiCA laws by December 30.
As reported by crypto.news in October, Coinbase had said it will delist non-compliant stablecoins from its European exchange by the end of this year because of the incoming MiCA regulations. One of the stablecoins to be delisted is Tether.
On November 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 have a year, until November 27, 2025, to redeem their holdings.
Tether also revealed plans to invest in Quantoz Payments to support MiCA-compliant stablecoins, like EURQ and USDQ.
