Coinbase Slashes USDC Fees for MetaMask Users—Just as Circle Plots Layer 1 Domination

Coinbase just handed MetaMask users a gift—drastically cutting USDC transaction fees. Meanwhile, Circle’s Layer 1 ambitions loom large. Is this a strategic play or just another chess move in crypto’s endless fee wars?

Fee Wars Heat Up

Coinbase’s fee reduction targets USDC transfers via MetaMask, a clear bid to retain users amid rising competition. No numbers disclosed—because why would they?—but the timing screams ‘competitive pressure.’

Circle’s Layer 1 Gambit

While Coinbase tweaks fees, Circle eyes the nuclear option: building its own chain. Because nothing solves blockchain fragmentation like adding another blockchain—said every VC-funded project ever.

The Bottom Line

Lower fees? Good. More chains? Debatable. One thing’s certain: in crypto, the house always wins—even when it’s cutting its own rake.

Stablecoins Gain Momentum

The growth in the interest in stablecoins like USDC can be traced to the passage of the GENIUS Act, which establishes licensing and regulatory framework for stablecoin issuers in the United States.

MetaMask’s Senior Product Manager Lorenzo Santos said as stablecoin use increases on the wallet, more users will likely turn to USDC. The partnership between Mercuryo and Coinbase is designed to make stablecoins faster, more accessible, and cheaper for users.

The move comes shortly after Circle announced plans to build a stablecoin-native LAYER 1 blockchain called Arc. USDC will be used as the gas token, allowing users to pay fees directly in USDC. Circle says Arc will offer low, predictable transaction costs in dollars, avoiding the swings of other cryptocurrencies.

USDC is currently the second-largest stablecoin by market capitalization. Circle reported that USDC in circulation grew 90% year-on-year to $61.3 billion in its latest report. 

The fee reductions and new infrastructure signal growing interest from financial institutions and crypto users. By lowering fees and supporting new Layer 1 solutions, USDC is becoming easier to use and more central in digital payments. These initiatives aim to strengthen stablecoins as key tools in the expanding crypto economy.

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