Crypto exchange Coinbase has slashed rewards on USDC stablecoin holdings by about 90%.
Until now, Coinbase users earned 1.25% annual percentage yield (APY) on their USDC funds. That reward now has been cut to just 0.15% APY, effective today.
Coinbase did not specify the rationale behind the move, but the reduction is in line with other major banks and fintech firms.
Coinbase launched the USDC rewards initiative last October for U.S. customers. Rewards accrue daily and are distributed on a monthly basis.
The USDC stablecoin is backed by CENTRE — a consortium co-founded by Coinbase and Circle. It is the second-largest stablecoin with over 7% market share, while Tether (USDT) dominates the space with over 85% market share.
The reward cut comes at a time when stablecoins are rising in popularity. The total supply of stablecoins hit $10 billion-mark for the first time last month.