Key Notes
- Coinbase will launch a Bitcoin Yield Fund for institutional investors outside the US on May 1.
- The fund will offer an annual net return of 4% to 8%.
- Assets will remain in cold storage with third-party custody integrations to minimize risk.
Coinbase, one of the largest crypto exchanges, is preparing to launch a Bitcoin Yield Fund on May 1, offering institutional investors outside the United States exposure to BTC.
According to Coinbase, the Bitcoin Yield Fund is expected to deliver an annual net return of 4% to 8% on investors’ Bitcoin
BTC
$93 733
24h volatility:
0.2%
Market cap:
$1.86 T
Vol. 24h:
$27.60 B
holdings. The fund has been approved by the Financial Services Regulatory Authority and is backed by institutional investors, including Aspen Digital.
What It Entails
The Coinbase Bitcoin Yield Fund (CBYF) was created to give institutional investors access to Bitcoin yield while maintaining a conservative annual return. The fund is considered necessary because Bitcoin differs from altcoins and traditional financial assets like Treasury bills, which naturally incorporate yields into their structure.
In the blog post, Coinbase explained that the fund aims to reduce the risks institutional investors may face when interacting with Bitcoin.
The announcement also stated that the fund will use qualified custodians and aims for an estimated strategy capacity of $1 billion in assets under management (AUM).
Coinbase Asset Management added that, to minimize risks, assets will not be moved from cold storage. Instead, the fund will use “third-party custody integrations to trade,” thereby reducing “counterparty risk.”
As part of its conservative approach, the fund will also avoid engaging in high-risk Bitcoin loans and systematic call selling.
Why We Need a Bitcoin Yield Fund
A Bitcoin yield fund like this has been long overdue. While Ethereum
ETH
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1.9%
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$212.52 B
Vol. 24h:
$12.65 B
and many other coins can be staked to earn attractive returns, Bitcoin holders have largely been left without a reliable way to generate passive income from their assets. This move is great news for long-term Bitcoin holders who want to earn a steady return without selling their BTC.
Coinbase pointed to the growing wave of institutional adoption in crypto as the main reason for launching the fund.
Backing this trend, market data shows that digital asset investment products attracted $3.4 billion in inflows last week, the third-largest weekly inflow on record and the highest since mid-December 2024.
Bitcoin led the charge, pulling in $3.18 billion of that total, according to CoinShares. As a result, Bitcoin-focused investment products now manage $132 billion in assets, reaching levels not seen since late February.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Rose is a crypto content writer with a strong background in finance and tech. She simplifies complex blockchain and cryptocurrency topics, offering insightful articles and market analysis to help readers navigate the evolving crypto landscape.
