Qualified users of Coinbase will continue to earn USDC rewards until November 30, with final payouts expected to be distributed in early December. However, the exchange has announced that starting December 1, it will discontinue its USDC rewards program for users in the European Economic Area (EEA), citing new regulations under the Markets in Crypto-Assets (MiCA) framework.
In an email sent to customers on November 28, Coinbase explained that the decision is in response to MiCA’s updated regulatory requirements. While the rewards program is ending for EEA users, qualified participants will still receive USDC rewards through the end of November, with final payouts expected within the first 10 business days of December.
How Coinbase’s USDC Rewards Program Works
Coinbase’s rewards program allows users to earn daily yields by holding USDC on the platform, offering a low-risk method of growing digital assets. Available in over 100 jurisdictions, the program provides global accessibility, with the annual percentage yield (APY) varying by region. This variation reflects factors such as local economic conditions, regulations, and market trends. Rewards accumulate automatically, and users typically receive payouts at regular intervals.
MiCA, which became effective in June 2023, introduces new rules for electronic money tokens like USDC, which are commonly used for earning rewards on platforms like Coinbase. Among the key changes is the requirement that issuers of e-money tokens be licensed credit or electronic money institutions. These issuers must undergo a rigorous authorization process, ensuring compliance with strict management, shareholder checks, and financial standards.
MiCA also mandates that e-money tokens be fully backed by reserves equal to their total circulating value, with these reserves needing to be secure, easily accessible, and well-managed to maintain token stability. In addition, the regulation requires that holders be able to redeem their tokens at any time for their full nominal value.
Coinbase and Other Platforms Align with MiCA Compliance
One of the most significant aspects of MiCA is the ban on offering interest-bearing products for e-money tokens like USDC. This move differentiates these tokens from traditional electronic money and aims to maintain their stability without classifying them as financial instruments.
In light of the new regulations, Coinbase recently confirmed that it will delist stablecoins that do not meet MiCA compliance requirements in the EEA. Other major platforms, including Uphold, Bitstamp, and Tether, have also announced plans to align with MiCA’s regulations.
