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Coinbase scraps plans for crypto lending program

Coinbase scraps plans for crypto lending program

The logo for Coinbase Global, the biggest US cryptocurrency exchange, is displayed on the Nasdaq MarketSite jumbotron and others at Times Square in New York, on Apr 14, 2021. (Photo: REUTERS/Shannon Stapleton)

Coinbase Global has scrapped its plan to launch an interest-yielding USD Coin (USDC) lending program, the cryptocurrency exchange said in a blog post.

The move comes days after US regulators said it would sue Coinbase if it went ahead with its program allowing users to earn interest by lending digital assets.

"As we continue our work to seek regulatory clarity for the crypto industry as a whole, we've made the difficult decision not to launch the USDC APY program," Coinbase's blog post said.

USDC is a stablecoin that is pegged to the US dollar and can be redeemed for US$1 on a one-to-one basis.

The crypto exchange also said it has discontinued the waitlist for its USDC APY (annual percentage yield) program, a high-yield alternative to traditional savings accounts that would have paid lenders of USDC to Coinbase a 4 per cent APY.

Coinbase, which said it has seen a rise in crypto interest account in recent times, had been planning to offer a principal guarantee to lenders of USDC in their Coinbase account.

It added that a 4per cent APY on USDC would provide a customer eight times the national average on high-yield savings accounts, based on a Bankrate.com survey of US savings accounts in June 2021.

Source: Reuters

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