Stablecoin provider Circle has increased its USDC recall fees for the second time this year. According to Bloomberg, users who want to make quick recalls will pay additional fees for transactions exceeding $2 million per day.
Updated Fee Structure
The phased recall options that Circle introduced in February are ongoing. The standard recall plan charged a 0.1% fee on withdrawals exceeding $15 million.
While standard recalls are processed almost immediately, basic recalls can take up to two business days to complete. Circle enrolled all customers in the standard plan and subjected the upgrade to the basic plan to manual approval.
New Wage Rates
Under the updated fees, standard recalls will be charged 0.03% between $2 million and $5 million and 0.06% between $5 million and $15 million. Sources speaking to Bloomberg stated that they are concerned that these fees, added in September, could reduce the attractiveness of USDC in trading.
Circle has become one of the highest-earning onchain businesses in the industry, generating $136 million in fee income in the last 30 days. Rival Tether earned $400 million in the same period and charges a flat 0.1% fee on recalls exceeding $100,000.
Market Share Struggle
USDC’s market share has fallen from 31% in February to 20% now. This decline is associated with the entry of traditional financial players into the stablecoin market and the rise of alternative stablecoin options. During the same period, Tether (USDT) increased its market share from 52% to 70%.
The new fees highlight the challenges USDC faces in a competitive market. Due to increasing fees, some users may turn to alternative stablecoins.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
