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In summary
- Coinbase discontinued its USDC rewards program in PREPA per MiCA regulations as of December 1, 2024.
- The MiCA law banned interest on stablecoins and required e-money reserves and licenses in the EU.
- Final reward payments were sent in the first business days of December.
Cryptocurrency exchange Coinbase will discontinue its USDC rewards program for customers in the European Economic Area (EEA) starting December 1, 2024, as part of its compliance with European Union regulations on Markets in Cryptoassets (MiCA).
Coinbase users reported receiving a email on Thursday in which the exchange announced the termination of its yield program, which allowed users to earn rewards on their holdings of the USDC stablecoin.
The change comes as MiCA, introduced in June 2023, imposes stricter rules on stablecoins, classifying them as electronic money tokens (EMTs).
These rules prohibit interest-bearing features and require issuers to maintain sufficient reserves and obtain electronic money authorization in at least one EU member state.
Affected customers will receive their final payments within the first ten business days of December. Until then, you can continue earning rewards on balances until November 30.
Many customers have expressed dissatisfaction with the changes. Sablier co-founder Paul Berg sarcastically commented on Twitter that he feels “very grateful to the EU” for protecting him from earning rewards on his USDC.
Ripple CTO David Schwartz described the situation as an example of regulations preventing companies from offering “pro-consumer” services.
Coinbase had hinted at the coming change in October, announcing plans to delist or adjust non-compliant tokens ahead of MiCA’s full implementation on December 30.
At the time, the cryptocurrency exchange told Decrypt that it would provide a detailed transition plan in November to help European customers switch to compliant stablecoins, such as USDC and EURC.
On Wednesday, stablecoin issuer Tether also announced that it will stop minting euro-backed tokens, citing regulatory hurdles in Europe.
Tether CEO Paolo Ardoino said the focus will now be on expanding Hadron, its asset tokenization platform.
Coinbase did not immediately respond to Decrypt’s request for comment.
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