Important Coinbase Update for Some Customers
Cryptocurrency exchange Coinbase has announced a fee for converting stablecoin usd coin (USDC) to USD.
Circle serves as the issuer of USDC, a stablecoin that surpassed tether‘s USDT token in terms of market cap as of last year.
Coinbase Introduces USDC Conversion Fees
Fees exceeding $75 million will be imposed on institutional customers who make net USDC to USD conversions within a 30-day period, according to a Jan. 29 post on the exchange’s website.
Coinbase uses a Maker-taker fee model to determine transaction fees. Different fees are applied to orders depending on whether the order provides liquidity (maker orders) or receives liquidity (taker orders).
The calculation of fees is based on the pricing tier at the time the order is placed, not the level that will apply after completion of the transaction.
A 0.1% fee will apply for conversions falling within the $75 million to $150 million range, while a 0.15% fee will apply for transactions between $150 million and $500 million. Specifically, conversions over $500 million will face a higher fee of 0.2%.
The company stated that Coinbase Prime customers who hold over $500 million in assets or hold an average of $100 million in USD/USDC during a calendar month will be exempt from these USDC conversion fees.
Additionally, exchange liquidity program participants who meet Coinbase’s Tier 1 or Tier 2 requirements will benefit from a waiver of USDC conversion fees when meeting their monthly obligations.
A spokesperson from the exchange expressed the company’s commitment to innovating its product offerings and incorporating user feedback. The commitment aims to deliver a world-class experience aligned with customer expectations while advancing the company’s business objectives.
Coinbase Conversion Fees Temporarily Waived
In December 2023, Coinbase urged its customers to shift their assets from USDT to USDC. The platform team highlighted recent events challenging some stablecoins, emphasizing that USDC stands out as one of the most reliable and respected digital dollars backed entirely by high-quality reserves.
To ease this transition for retail customers, Coinbase has temporarily waived USDT to USDC conversion fees in most regions on the Coinbase Simple Commerce trading section.
In March 2023, the exchange took precautionary measures by temporarily halting conversions between the USDC stablecoin and the US dollar following the collapse of Silicon Valley Bank (SIVB). The firm announced in a tweet that there was a “temporary pause” during the weekend when banks were closed and plans to resume conversions on Monday.
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