Coinbase is set to introduce its Bitcoin Yield Fund on May 1, providing institutional investors with an opportunity to earn 4%–8% annual returns on their Bitcoin holdings. The initiative addresses the rising demand among institutions for Bitcoin yield options, which traditionally have offered limited opportunities for passive income. The fund aims to mitigate investment and operational risks typically associated with Bitcoin yield products, making it more appealing for institutional investors. It will utilize a cash-and-carry strategy to generate yield, capitalizing on price differences between spot Bitcoin and derivatives. Backed by various investors, including Aspen Digital in Abu Dhabi, the fund seeks to fill the void in the market since Bitcoin cannot be staked in a similar manner to other cryptocurrencies like Ether. This endeavor represents Coinbase’s efforts to align with the risk profiles of institutional allocators while responding to the evolving landscape of cryptocurrency investment.

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