Coinbase Launches Bitcoin Yield Fund for Institutional Investors
Coinbase plans to launch its Bitcoin Yield Fund on May 1, targeting institutional investors outside the US seeking passive income from their Bitcoin holdings. The world's third-largest cryptocurrency exchange by volume announced the fund will aim for annual net returns between 4% and 8%.
According to the April 28 blog post, the Coinbase Bitcoin Yield Fund (CBYF) was created in response to growing institutional demand for Bitcoin yield opportunities. The fund has secured backing from multiple investors, including Abu Dhabi-based digital asset manager Aspen Digital.
The yield will be generated through a cash-and-carry strategy that capitalizes on the difference between spot Bitcoin prices and derivatives. This approach provides a solution for Bitcoin holders who cannot generate passive income through staking, unlike Ethereum and Solana users.
Coinbase stated that existing Bitcoin yield funds typically require institutional investors to accept significant investment and operational risks. Their new fund aims to reduce these risks to better match institutional risk appetites.
The launch comes amid growing institutional crypto adoption, which may have contributed to Bitcoin's recent price performance. Bitcoin rose more than 9% in the week leading to April 28, reaching approximately $94,000.
This recovery was supported by strong exchange-traded fund (ETF) inflows, which recorded their second-highest week at over $3 billion according to Farside Investors data. Ryan Lee, chief analyst at Bitget Research, noted that Bitcoin's recovery was mainly driven by "ETF inflows and corporate buying" while retail interest lagged.
BitMEX co-founder Arthur Hayes suggested on April 21 that this might be the "last chance" to purchase Bitcoin below $100,000, as upcoming US Treasury buybacks could serve as the next major catalyst for Bitcoin price growth.
The launch of Coinbase's institutional Bitcoin fund parallels other international Bitcoin developments. El Salvador has continued its Bitcoin acquisition strategy, purchasing 7 Bitcoin worth over $650,000 in the week leading to April 27, according to the country's Bitcoin Office. This occurs despite an IMF agreement that appeared to restrict such purchases, with IMF Western Hemisphere Department director Rodrigo Valdes confirming El Salvador remains in compliance with their $1.4 billion loan terms.
