Circle, the provider of the stablecoin USDC, has raised its withdrawal fees for the second time this year. According to Bloomberg, users opting for expedited withdrawals will face additional charges on transactions that exceed $2 million per day.
**Contents:**
1. Revised Fee Structure
2. New Fee Rates
3. Competitive Market Landscape
**Revised Fee Structure**
Circle has continued to apply the tiered withdrawal system that was introduced in February. For standard withdrawals, a fee of 0.1% will be applied to amounts exceeding $15 million. While standard withdrawals are processed nearly instantly, basic withdrawals may take up to two business days to finalize. All customers have been enrolled in the standard withdrawal plan, meaning that transitioning to the basic plan will require manual approval.
**New Fee Rates**
Under the new fee schedule, standard withdrawals will incur a fee of 0.03% for amounts ranging from $2 million to $5 million, and a fee of 0.06% for amounts between $5 million and $15 million. Sources cited by Bloomberg have raised concerns that these newly implemented fees could diminish the appeal of USDC in trading contexts. In the last 30 days, Circle has generated $136 million in fee revenue, placing it among the top earners in the on-chain business sector. In contrast, its competitor Tether generated $400 million during the same timeframe and maintains a fixed fee of 0.1% for withdrawals above $100,000.
**Competitive Market Landscape**
USDC’s market share has dropped from 31% in February to a current 20%. This decline is attributed to the entry of traditional financial institutions into the stablecoin arena and the emergence of various alternative stablecoin options. Over the same period, Tether (USDT) has increased its market share from 52% to 70%.
The introduction of the new fees underscores the competitive challenges faced by USDC. As withdrawal fees rise, some users may seek alternatives among other stablecoins.
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**Disclaimer:**
The information presented in this article does not serve as investment advice. Investors should be aware of the high volatility and associated risks of cryptocurrencies and are encouraged to conduct their own research.