Circle’s USDC business accounts fire at DeFi. On March 10, 2020, Circle, the Goldman Sachs-backed payments company and USDC stablecoin issuer, announced their Circle Business Account operation. The accounts provided a suite of services that were designed to help corporations leverage USDC. This involves APIs that could link to conventional payment rails, accept dollar-denominated payments such as USDC, a wallet service from USDC, and enter multiple markets for e-commerce.
However, account holders would have been encouraged to transfer their stablecoin funds elsewhere provided the yields that stablecoins such as USDC can produce in DeFi protocols. Lending protocols such as Aave and Fulcrum currently yield 3.4 percent and 11.6 percent on USDC respectively, according to DeFirate.
On Nov. 5, 2020, Circle announced new high-yield accounts that may encourage account holders to keep their funds parked in CeFi. In a Tweet on Thursday, Circle announced a waitlist for new interest-bearing business accounts. According to their website, terms and rates will range between the open-term 8.5% APY accounts, to the 12-month 10.75% APY accounts.
Additionally, the yields will be accrued daily and paid weekly, as opposed to on a monthly or even yearly basis often seen in traditional business accounts. This will bring the accounts closer in line with many DeFi lending protocols, which offer interest in real-time. The end result is a product that appears to combine the attractive yields and delivery of DeFi interest with the brand-based guarantees of centralized finance.
Circle’s offering is just the latest in a wider CeFi-meets-DeFi trend. In August, OKEx and Bitrue announced lending platforms which would blend DeFi and CeFi features.