As Ethereum network fees keep getting bigger, crypto firms are looking for alternatives to take the cost of transfers back to reasonable levels. Coinbase is the most recent platform to come with an upgrade to its stablecoin USD Coin.
Centre Consortium members Circle and Coinbase have released an upgraded version of their popular USDC dollar-pegged stablecoin. The new update, USDC 2.0, which went live yesterday, on August 27th, plans to address high gas fees by enabling developers to delegate it to other wallets or take fees in USDC instead.
Removing ETH Out of View
The official announcement detailed the fact that the majority of users need to keep a balance of Ether in their wallets in order to carry out transactions. The developers then added that this ended up being an unnecessary complexity.
“This complexity presents a barrier to mainstream adoption and broad usage of digital dollar stablecoins for internet payments.”
To tackle this issue, USDC 2.0 will incorporate what it is called ‘gasless sends,’ which enables wallet developers to ‘abstract away’ the intricacy of gas fees. It would enable them to delegate the payment of gas fees to another address instead, which negates the requirement for the user to hold a balance of ETH.
Developers could either pay the fees instead of their clients or enable third-party services to take care of the process. The goal is clear – to remove Ethereum from the picture and allow users to send and receive USDC payments by only using USDC, and with fees expressed and paid in USDC.
There are some other security improvements with the new coin, such as a new set of on-chain multiple-signature contracts with a new consensus mechanism. The upgrades are completely backward compatible; therefore, they have no impact or changes on existing wallets, exchanges, or apps currently having USDC.
As per Coinbase, USDC has a market cap of $1.4 billion and over $90 billion in on-chain transaction volume.