Stablecoin rewards restrictions can slow but not stop Circle's USDC, says Citigroup

Citigroup's analysis suggests that restrictions on stablecoin rewards could hinder USDC adoption by reducing transaction volume, despite stablecoins remaining in circulation. The primary impact affects Circle's USDC ecosystem, particularly its liquidity providers and institutional users relying on reward incentives. While not a direct vulnerability, the policy shift may slow growth and liquidity in the USDC market.