Coinbase Plans to Generate 4%-8% Returns Through New Bitcoin Yield Fund

Coinbase Introduces Bitcoin Yield Fund with Targeted 4%-8% Annual Returns

Coinbase has launched a new Bitcoin yield fund, aimed at institutional investors, with a projected return range of 4%-8% annually. The fund, set to launch on May 1, will initially focus on basis trading—a strategy that takes advantage of price differences between Bitcoin’s spot and futures markets. Future plans for the fund include expanding into lending and options strategies.

Developed in partnership with Aspen Digital, an Abu Dhabi-based firm, the fund is specifically designed for non-U.S. institutional investors. The basis trading strategy, which has gained popularity since late 2024, involves profiting from the gap between Bitcoin’s spot price and its futures contracts. While this strategy offers a lower risk profile compared to other crypto trading methods, it is still susceptible to market volatility, which could lead to margin calls if Bitcoin’s price unexpectedly shifts.

The fund’s introduction comes as institutional interest in Bitcoin continues to grow. However, the yields from basis trading have become more modest as the strategy becomes more widely adopted. This dynamic has led some traders to reduce their exposure to basis trading, while others remain hopeful for consistent returns.

Coinbase’s fund represents a shift from the lending-focused yield strategies of other crypto firms like BlockFi, which collapsed during the 2022 market downturn. By focusing on basis trading, Coinbase is aiming for a more conservative and less risky approach to generate yield for its investors.

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