Leading cryptocurrency exchange and wallet provider Crypto.com has made a u-turn regarding staking rewards.
The move comes following widespread backlash from the crypto community and Crypto.com cardholders.
Crypto.com posted a notice on May 1 stating that it was changing the CRO Card rewards program. There are four tiers of Crypto.com Visa cards, and the lowest “Ruby” card saw rewards slashed to less than 1%. Furthermore, the second tier “Jade” card had a 50% cut. The top two cards, “Icy” and “Obsidian,” saw staking rewards slashed by 40% and 37.5%, respectively.
This image was widely shared among users of the platform who expressed their annoyance at the move.
Additionally, the platform’s native CRO token plunged by around 30% following the move. As expected, there was a lot of backlash from cardholders, with one stating:
“These changes will 100% kill the product. At the very least the cashback rates needed to remain to give the $CRO token a utility. That utility is pretty-much non-existent now. The card+cashback was your way to get the masses involved; now you’ve fucked it. Thousands will leave.”
Many also said that the company had spent too much on sports advertising recently.
On May 3, Crypto.com CEO Kris Marszalek said the firm will continue to offer staking rewards to cardholders. Additionally, he acknowledged that the “community has been really vocal” and that the rewards would be revised.
The community has been really vocal with regards to the changes to the card program announced yesterday. We care deeply about the community, we hear you & always listen to you.
As a result, we're revising card staking rates. 🧵
— Kris | Crypto.com (@kris) May 3, 2022
He stated that instead of eliminating card staking earn rates completely, there will be a “more balanced approach.”
This would be 8% APY for Private Members with Obsidian, Icy White, and Frosted Rose Gold cards. There would also be 4% APY for Royal Indigo and Jade Green cardholders, he added.
These are, of course, tough decisions, he stated. “Nobody wants benefits to be reduced, least of all me. Given our large scale though, it is necessary to ensure long-term sustainability,” he added.
Users still pointed out that the lower-tier cards still had very little incentive as an introduction to the ecosystem. To obtain one of the pre-paid Visa cards, users need to stake CRO tokens.
CRO Price Outlook
Cronos (CRO) slumped to a six-month low following the move. As a result, the token tanked to $0.268 on May 3 as disgruntled holders cashed out.
However, there has been a marginal gain of 2.7% over the past 24 hours as CRO reached $0.297. The token is currently down 69% from its November 2021 all-time high of $0.965.
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