Coinbase Offers Free Trades from USDT to USDC

One of crypto’s largest centralized exchanges is shaking up the battle for stablecoin supremacy.

Coinbase, the second largest exchange by volume, which processed over $1B of trades on Dec. 8, is encouraging its users to swap from USDT to USDC with fee-less trades.

“We believe that USD Coin (USDC) is a trusted and reputable stablecoin, so we’re making it more frictionless to switch,” reads Coinbase’s announcement. The exchange emphasized the importance of stability and trust repeatedly in the announcement.

With a market capitalization of $65B, USDT is the largest stablecoin in crypto, according to Coingecko. At $42B, USDC is the second largest.

Since its inception, Tether, the company that issues USDT, has faced scrutiny over the reserves backing its stablecoin. With Coinbase’s announcement emphasizing the importance of trust while also allowing a one-way free swap from USDT to USDC, the company is also playing into the concerns often voiced about Tether.

USDC is managed by a little-known consortium called Centre, of which Coinbase is a founding member.

Circle, also a member of Centre and the primary company responsible for managing USDC, abandoned its plans earlier this week to go public by way of a special purpose acquisition vehicle (SPAC).

Exchanges are seemingly taking sides in the competition for stablecoin dominance. In September, Binance, the world’s largest crypto exchange, began to convert users’ stablecoin balances into its own BUSD token.