Coinbase asks users to convert their USDT to USDC for free Coinbase asks users to convert their USDT to USDC for free
Several stakeholders in the crypto community have questioned Coinbase's motive, with some describing the move as "desperate."
2 min read
Updated: Jun. 23, 2023 at 10:43 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Coinbase is incentivizing its users to convert their Tether (USDT) holdings for USD Coin (USDC), according to a Dec. 8 blog post.
Switch to a trusted stablecoin: USD Coin (USDC). Now convert Tether (USDT) to USDC with zero fees.https://t.co/OObSqNWdpj
— Coinbase (@coinbase) December 8, 2022
According to the US-based exchange, recent events have shown that customers needed stability and trust in fiat-backed stablecoins in times of volatility. Because of this, it revealed that it was waiving its fees for the conversion.
Coinbase said USDC was fully backed with “high-quality reserves,” adding that it delivers transparency via “monthly attestations by Grant Thornton LLP.”
Tether has been subject to several regulatory scrutinies over its failure to provide adequate transparency over its reserves. The stablecoin issuer recently said it has cut down its commercial paper holdings to zero and will invest more in U.S. Treasury Bills and short-term government-issued debt.
Crypto community wary of Coinbase’s offering
Several stakeholders in the crypto community have questioned Coinbase’s motive, with some describing the move as “desperate.”
Not a good look. Also looks desperate.
Makes me trust USDC a little less tbh.
— Byzantine General (@ByzGeneral) December 9, 2022
The strategy advisor at VanEck, Gabor Gurbacs, said:
“Tether was the first stablecoin in the world and has been trusted by millions around the world since its inception. In fact if you ask people outside a narrow group in the US theyโd pick tether over USDC.”
Tether’s CTO Paolo Ardoino retweeted Gurbacs’ statement. He also retweeted James Viggy’s statement that questioned how Coinbase has invested in the Bitcoin ecosystem development.
Meanwhile, BTC’s early investor Samson Mow opined that users should beware of companies that offer free stuff because “the door in is usually big, but the door out is small.”
Always beware when companies offer free stuff. The door in is usually big, but the door out is small.
— Samson Mow (@Excellion) December 9, 2022
Tether remains the market leader
According to CryptoSlate data, Tether is the dominant stablecoin in the industry. It controls around 50% of the market, and its supply is over $65 billion. As of press time, USDT is responsible for 75% of stablecoin’s trading volume.
On the other hand, USDC is the second-largest stablecoin, with a circulating supply of $42.7 billion. Its supply shrunk by $10 billion following Binance’s decision toย convert its users’ balance in USDC to BUSD.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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In this article
Launched in 2014, Tether is a blockchain-enabled platform designed to facilitate the use of fiat currencies in a digital manner.
USD Coin
$0.99990
USD Coin (USDC) is a stablecoin fully backed by the US dollar and developed by the CENTRE consortium.
Binance USD
$1.00165
BUSD is a stablecoin issued by Paxos in partnership with Binance..
Coinbase
Coinbase is a digital currency exchange and wallet service that allows individuals to buy, sell, and store digital currencies, such as Bitcoin, Ethereum, and Litecoin.
Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Paolo Ardoino joined Bitfinex at the beginning of 2015 and now serves as Chief Technology Officer.
Brian Armstrong, co-founder and CEO of Coinbase, stands at the forefront of the digital currency revolution.
