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Coinbase Launches USDC 2.0 to Tackle High Gas Fees

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Coinbase Launches USDC 2.0 to Tackle High Gas Fees

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Center Consortium members, Circle and Coinbase, have just released an updated version of their popular USDC dollar stable stablecoin. USDC 2.0 will be launched on August 27th to solve the problem of high gas fees by letting developers entrust it to other wallets or charging fees in USDC.

The official announcement stated that most users would need to have ETH balance in their wallets in order to conduct transactions. This leads to unnecessary complexity:

“This complexity presents a barrier to mainstream adoption and broad usage of digital dollar stablecoins for internet payments.”

Introducing USDC 2.0

To solve this problem, USDC 2.0 will introduce its so-called “gasless sends” that allows wallet developers to “abstract” the complexity of gas charges. This allows them to delegate the payment of gas fees to a different address. Therefore, users no longer have to hold ETH credits.

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Developers can pay on behalf of their customers or through third-party services. The purpose is to clearly remove Ethereum from the equation so that users can send and receive USDC payments. They can do so using only USDC, and express and pay fees in USDC.

The new coin has other security improvements, including a new set of multiple signature contracts in the chain with a new consensus mechanism. The upgrade is fully backward compatible and will not affect or change any wallet currently integrated with USDC.

Ethereum Rates are Slowly Falling Back

Ethereum’s network fees are still at their highest level in more than two years. However, the price have fallen in the past two weeks. According to Bitinfocharts, the average gas fee fell from a historical high of $6.60 to $2.50.

However, this is still much higher than it was for most of the first quarter. Due to the DeFi boom, the number of transactions on Ethereum has just approached the historic high of 1.13 million.

ETHGasStation reported that Uniswap was the largest producer of network fees with an amount of $12.7 million in the last 30 days. ether came in second with fees of $10.5 million.

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