Thomas Daniels
Coinbase will introduce a 0.1% fee on net USDC-to-USD conversions exceeding $5 million within a rolling 30-day period, starting August 13, 2025. The fee will be applied to net conversions, calculated by subtracting USDC purchases from USDC sales.
The move follows two consecutive quarters of earnings disappointments. In Q2 2025, Coinbase reported $1.5 billion in revenue, falling short of analyst estimates of $1.56–$1.59 billion. Its share price declined by 8% following the earnings release. However, stablecoin-related revenue grew 12% year-on-year to $332 million.
Will McComb, Coinbase’s senior product manager for stablecoins, described the change as an “experiment” aimed at evaluating how fees influence users’ behavior in converting USDC to fiat. He acknowledged community feedback and stated that the company remains committed to enhancing the stablecoin experience on its platform.
Previously, Coinbase allowed fee-free conversions up to $40 million in a 30-day span. Conversions from $40 million to $100 million were charged 0.05%, scaling to 0.2% beyond $200 million.
Industry voices speculate the policy may deter arbitrage strategies, particularly those involving swapping Tether (USDT) for USDC and using Coinbase to off-ramp into USD without fees—an activity that had been decreasing USDC supply. Coinbase CEO Brian Armstrong appeared to confirm this rationale by concurring with public commentary.
Analysts have drawn parallels between the new fee structure and the cost mechanics of ETF redemption. With rising flows in one direction, Coinbase likely incurs operational costs in facilitating large-scale conversions—costs now being passed to users.
This policy shift underscores the company’s response to revenue pressure, market behavior, and the operational costs associated with managing stablecoin liquidity.
