MetaMask has introduced a new feature that allows users to earn passive yield by storing stablecoins in their wallets. This innovative offering, known as Stablecoin Earn, is powered by the Aave protocol, providing users with a seamless way to generate rewards directly from their mobile app.
The launch of Stablecoin Earn marks MetaMask’s first foray into the world of passive rewards programs for stablecoin deposits. Users now have the opportunity to deposit stablecoins such as USDC, USDT, and DAI into the Aave protocol through the MetaMask mobile app, without any lock-up period.
This new feature is currently available on Android devices, with iOS compatibility expected to follow shortly. One of the key advantages of Stablecoin Earn is that users retain full self-custody of their assets, as they are directly controlled through the MetaMask wallet.
So how exactly does MetaMask’s Stablecoin Earn work? Users simply need to deposit their stablecoins into the Aave lending protocol from within the wallet. There are no additional fees incurred during this process. By depositing stablecoins, users receive “aTokens” in return. For example, if a user deposits USDC, they will receive an equivalent amount in aUSDC.
Once users have acquired aTokens, they can track the growth of their invested tokens’ passive yield through the platform’s mobile app, which displays variable reward rates. Importantly, users have the flexibility to withdraw their funds at any time, as the tokens are not subject to a lock-up period. The aTokens held in the wallet represent the amount of stablecoins that users can withdraw.
Stablecoin Earn comes at a time when other platforms, such as Binance and PayPal, have also introduced stablecoin rewards products. Binance’s RWUSD tokenizes U.S. Treasury Bonds and other RWAs, offering a yield of 4.2% APR. On the other hand, PayPal’s PYUSD Rewards program allows holders to earn rewards daily based on the amount of stablecoins they hold and the applicable “PYUSD Rewards Rate.”
Overall, MetaMask’s Stablecoin Earn feature provides users with a convenient and secure way to earn passive yield on their stablecoin holdings. With the flexibility to withdraw funds at any time and full control over their assets, users can maximize their earning potential while maintaining control over their financial assets.