Demex Daily #9: $COIN Coinbase Boosts USDC Interest Rate to 5% to Spur Stablecoin Adoption

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Friend.tech, a blockchain-based social networking platform, recently regained some of its lost momentum by hitting a 30-day revenue high of $5.6 million. This surge in revenue comes amid increased usage over the last two weeks, even after the initial hype around its launch faded. On September 9, the platform had 9,000 Daily Active Users and 2,000 new sign-ups, with a trading volume of $12.3 million and $1.23 million in fees collected. The platform's key innovation allows users to buy and sell "keys" for sending private messages, from which it takes a 5% cut. Despite an initial boom in August, the platform experienced an 87% drop in daily fees and a 90% decline in transaction volume by the end of that month. Critics attribute the downturn to a mix of "greed and poor execution."

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Coinbase has raised the interest rate on USDC holdings to 5%, a significant increase from the 2% rate active as of June 9. This hike comes after the SEC clarified that stablecoins like USDC are not unregistered securities, thereby allowing Coinbase to offer rewards for holding them. The aggressive rate increase aims to boost USDC adoption, which has lagged behind rival stablecoin Tether (USDT). Despite setbacks, including regulatory challenges and a dip in market capitalization, USDC is showing signs of regaining momentum.