Coinbase, one of the world’s largest crypto exchange, is launching the Coinbase Bitcoin Yield Fund (CBYF) on May 1 to meet soaring institutional demand for Bitcoin exposure outside the United States. The fund targets a net annual return between 4% and 8% on Bitcoin holdings, according to a company blog post on April 28.

Backed by investors like Aspen Digital, a regulated asset manager in Abu Dhabi, CBYF plans to generate yield through a cash-and-carry strategy, capitalizing on the price difference between Bitcoin spot and derivatives markets. Unlike Ethereum or Solana, Bitcoin cannot be staked to earn passive income, leaving a gap Coinbase intends to fill without exposing investors to high operational risks.

Coinbase emphasized that the new fund is structured to appeal to the risk profiles of large institutions, helping them access Bitcoin yields with reduced complexity. The announcement comes amid a notable rise in Bitcoin’s price, with the asset surging over 9% in the past week, largely driven by strong inflows into Bitcoin ETFs, totaling more than $3 billion according to Farside Investors.

Bitcoin recently hit $94,000, bolstered by corporate buying and institutional flows, although retail participation remains weak. Analysts predict retail investors could re-enter the market if Bitcoin crosses the $100,000 threshold, fueled by media attention and fear of missing out. BitMEX co-founder Arthur Hayes even suggested this might be the "last chance" to buy Bitcoin under six figures, with potential new catalysts on the horizon from upcoming US Treasury buybacks.