The cryptocurrency community is no stranger to Bitcoin savings accounts that boast high annual percentage yields (APY) and give users the ability to stash their satoshis for extended periods of time. The issue? The volatility of the digital asset could result in more losses than earnings and not all providers are necessarily trustworthy.
The cryptocurrency community is no stranger to Bitcoin savings accounts that boast high annual percentage yields (APY) and give users the ability to stash their satoshis for extended periods of time. The issue? The volatility of the digital asset could result in more losses than earnings and not all providers are necessarily trustworthy.
The user experience is really super smooth and simple. As soon as you have USDC in your account, you start earning rewards and you can see reward counting up in real-time so you know at any given time exactly how much you’re earning. You can use that right then and there on the platform to buy any other crypto. (Max Brazenburg, the director of product at Coinbase)
Fortunately, Coinbase has come to the rescue.
As of the 2nd of October, Coinbase users who hold at least $1 worth of the stablecoin USDC are able to earn interest on their holdings. As long as customers keep these coins stored on the platform, they are looking at a 1.25 APY increase in their assets.
The product manager at Coinbase, Paul Katsen, said that this development was largely due to shifting profitability over from traders to those who want to use crypto as a store of value.
“We’re trying to build more ways for customers to grow their wealth on Coinbase. One of the things we know is a bad customer experience is having to move your money back and forth from Coinbase to a bank account [to] earn a little bit of interest in the bank account. We’re trying to bring some of these experiences together but make them crypto-first and on Coinbase.”
Once a user’s account meets the minimum requirements, rewards will automatically begin accumulating and will be paid out to the user on a monthly basis. Users can also track their investments and rewards as they happen in real-time.
Max Brazenburg, the director of product at Coinbase, built upon Katsen’s statement by adding:
“The user experience is really super smooth and simple. As soon as you have USDC in your account, you start earning rewards and you can see reward counting up in real-time so you know at any given time exactly how much you’re earning. You can use that right then and there on the platform to buy any other crypto.” He also emphasized the profitability of the opportunity, which provides, “15 times more than the national average or what people might get through a [traditional] savings account.”
While many may notice that these rates aren’t as high as some other platforms offering similar programs, the Coinbase savings program makes it simple for Coinbase users to grow their wealth through the platform without having to jump through any hoops. This is especially helpful for those in developing countries where the opportunity for such savings may not be possible.
Along with Coinbase, Circle (which has formed the CIRCLE consortium with Coinbase) is the only other company with the ability to sell USDC coins. The pair are currently working together to improve adoption and foster development.
While crypto savings is the only feature now, Coinbase expects to come out with new ways to reward customers in the near future.
