Revisions to Crypto.com’s map and staking rewards have caused token prices to drop by up to 11% as the community has expressed dismay at the changes that will come into effect after June 1.
In a blog post on Sunday, Crypto.com said it would reduce rewards on the use of its Visa-enabled cards based on tiers offered. Lower tiers – such as Midnight Blue and Ruby Steel – would get 0%, Royal Indigo and Jade Green would get 0.5%, Icy White and Frosted Rose Gold would get 1%, while Osbidian, the highest tier, would only get only 2%.
Level prices revised. (Crypto.com)
Monthly rewards on lower tiers would be capped at $25 to $50, while there would be no reward cap on higher tiers, the company said.
Staking rewards on Crypto.com cards would also cease after the end of the 180-day period for everyone who staked on or before May 1, except for the lowest two tier cards.
This is a steep drop from current rates of 1% on the lower tier cards, to over 8% on the highest tier, depending on funds staked. Crypto.com’s prepaid cards are a popular product in cryptocurrency circles, allowing users to load supported cryptocurrencies or stablecoins and spend fiat at Visa merchants.
Meanwhile, other card benefits, such as cash back on subscription services and free airport lounge access, would continue. Additionally, interest rates on Crypto.com’s Earn product, which allows users to earn up to 14% on crypto holdings, remain unchanged.
The community reacts
Map users expressed dismay at the changes in social media posts on Reddit and Twitter. Most comments criticized the decision. “I will continue to use the card for the remainder of my staking period and then retire and say goodbye to the card,” one Reddit user said. “It’s not the end but they just lost a lot of customers,” said another.
Some on Twitter have said that the rates of return offered on decentralized finance (DeFi) apps are much more lucrative as a use of idle capital.
Prices for CRO, the native tokens of Crypto.com, have fallen 11% in the past 24 hours, with most of the losses occurring within hours of the rewards decision. CRO traded above $0.36 on Sunday and fell to $0.29 in Asian time on Monday before recovering slightly at the time of writing.
CRO prices fell sharply. (TradingView)
Some analysts explained that the lack of adequate rewards contributed to a lower fundamental value for CRO tokens, which drove the price down.
“CRO token staking enabled rewards for users and incentivized use of their debit card,” Edson Ayllon, Product Manager at dHEDGE, shared in a Telegram post. “The reduction in cashback rewards has reduced the intrinsic value proposition of CRO. This is similar to how DeFi protocols use liquidity mining to attract assets. It is often intended to prime liquidity, and we see in DeFi that when the incentives dry up, often the price of the token takes a hit. »
Crypto.com has not returned any requests for comment at the time of writing.
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Crypto.com Cuts Card Rewards, CRO Tokens Drop 11% as Community Responds | Cryptocurrency
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