Coinbase and PayPal Continue Stablecoin Reward Programs Despite Genius Ban

PANews reported on August 5th that according to Decrypt, after the US GENIUS Act came into effect last month, while prohibiting stablecoin issuers from offering users passive income from staking or depositing balances, Coinbase and PayPal continued to offer users annualized returns of 3%-5% through their "rewards programs." Coinbase CEO Brian Armstrong explained on an earnings call that the company is not the issuer of USDC (which is issued by Circle) and that the rewards offered are "rewards," not "interest," and therefore do not violate the new regulations. PayPal also maintains a 3.7% return program on its PYUSD stablecoin through third-party issuer Paxos. Senate staff stated that the bill only regulates the behavior of issuers and does not restrict secondary market service providers.