Coinbase Is Using an Ethereum Upgrade to Help Merchants Accept USDC

Coinbase Commerce is putting ethereum's most recent upgrade, Constantinople, to use for thousands of retailers and merchants around the world.

Launched early last year, Coinbase Commerce is an app for online vendors wanting to accept payments in crypto and integrate these purchases into existing business cash flows.

Recently, the application added support for ethereum-based stablecoin USDC. On Wednesday, Coinbase Commerce software engineer Bojan Joveski released a blog post discussing the new ethereum feature that makes USDC payments possible.

"CREATE2 is very recent addition to the ethereum ecosystem and it's very important because it enables workflows that were impossible or at least very impractical before," said Joveski.

CREATE2 was activated on the ethereum blockchain in February as part of a larger systemwide upgrade known as Constantinople.

According to Joveski, the implications of his report suggest a cost-effective and secure way for Coinbase Commerce to support virtually any ethereum-based ERC-20 token, not just USDC. What's more, it's not only payments on the ethereum blockchain that Joveski suspects can benefit from the CREATE2 feature.

Originally proposed by the founder of ethereum, Vitalik Buterin, Ethereum Improvement Proposal 1014, or "CREATE2," adds a new operation code enabling developers to deploy a smart contract on ethereum in the future tense.

On Coinbase Commerce, smart contracts facilitating the payment and receipt of USDC tokens only have to interact and pay fees to the ethereum blockchain for final settlement.

For now, initiating payments of USDC on Coinbase Commerce is free for all customers.

"What is novel about this is that the ethereum ecosystem is releasing all these new features. This is essentially one of the first tries to use those features and build a secure [payments] system on the platform."