San Francisco-based cryptocurrency exchange Coinbase has started rewarding users who hold MakerDAO’s DAI stablecoin in their accounts with a 2% yield per year, with the rate being subject to change.
According to an announcement the cryptocurrency exchange published, the program applies to customers in the U.S., U.K., France, Australia, Spain, and the Netherlands. Coinbase was already letting its over 35 million users earn crypto rewards – including in DAI – through its coinbase Earn program, but it’s not rewarding holders with a 2% APY.
Per the exchange, stablecoins like DAI and USDC stand out as an alternative to passively generate income, as right now yields on savings accounts and government bonds are at record lows. Coinbase also offers USDC holders interest on their holdings.
To start earning n their DAI holdings, users need to have at least $1 worth of the stablecoin on their Coinbase accounts – either bought at the exchange or transferred in from an external wallet. The post reads:
Initial rewards will be distributed within five business days, then every day following, which means customers can use or withdraw their rewards as soon as they receive them.
Users will maintain control of their funds, as their DAI will be in their accounts available for withdrawal at any time. It’s worth pointing out that the stablecoin’s issuer, MakerDAO, already lets users earn DAI via the Dai Savings Rate on the Oasis app.
The Dai Savings Rate was paused earlier this month, but before being paused it was at 4%. Via decentralized finance protocols, users can also earn on their stablecoin holdings, although some see these platforms as risky because of the ongoing yield farming trend and past exploits.
Featured image via Pixabay.