Coinbase, the world’s second-largest cryptocurrency exchange in terms of trading volume, is incentivizing transactions between USDT and USDC by waiving the associated transaction fees.
As a response to the failure of FTX, Coinbase has started eliminating fees for its worldwide retail clients who desire to transfer to a “reliable stablecoin.” According to reports, the value of Tether (USDT) dropped significantly below 93 cents and was thrown off its peg shortly after FTX had a sudden crash.
“The events of the previous few weeks have put certain stablecoins to the test and we’ve witnessed a flight to safety,” Coinbase said in a blog post. “We feel that USD Coin (USDC) is a reliable and respected stablecoin,” the exchange stressed.
Coinbase, one of the companies that helped develop USDC in 2018, made the following statement about the cryptocurrency: “USDC is unique in that it is 100% backed by cash and short-dated U.S. bonds stored in U.S. licensed financial institutions.” It is always redeemable for U.S. dollars at a rate of 1:1.
At the time of this writing, one USDT may be purchased for 99 cents and represents 5% of the total volume traded on the exchange. On-chain data reveals this information. At the moment, USDT is the digital asset that is exchanged on Coinbase the third most often.
However, according to CoinGecko, certain trading pairs on Binance will continue to trade at 99 cents for USDT even if the bulk of trading pairs on exchanges have restored to $1.
The most recent action taken by Coinbase was a jab at a competing stablecoin known as Tether. Tether is now the most valuable stablecoin on the market, with a market value of $65 billion. The most recent announcement will almost certainly spark a battle for the dominance of stablecoins. There is no way to avoid the fact that exchanges will be considered to be taking sides in the battle for stablecoin supremacy.
Tether responded to what it called “media FUD” over increased loan risk last week. It mentioned in its blog post about how mainstream media has failed to forecast the collapse of key cryptocurrency platforms that continued on hammering Tether how mainstream media has failed to predict the demise of big cryptocurrency platforms.
The cryptocurrency company Tether, which produces USDT, has come under investigation about the reserves supporting its stablecoin. Coinbase is making their worry abundantly evident by releasing a statement that places a strong emphasis on the need of trust and stability while also removing fees associated with trading USDT for USDC.
Compiled by Coinbold