Coinbase Relaunches Stablecoin Bootstrap Fund To Enhance DeFi Liquidity
Cryptocurrency exchange Coinbase announced the launch of its second Stablecoin Bootstrap Fund, managed by Coinbase Asset Management (CBAM). The primary objective of the fund is to enhance liquidity for stablecoins throughout the on-chain ecosystem, ensuring that users can access dependable rates across both established and emerging protocols. The first investments from the fund are being placed in platforms like Aave, Morpho, Kamino, and Jupiter, with the aim of improving stablecoin liquidity within these ecosystems.
As the fund grows, Coinbase plans to extend its liquidity support to a broader range of protocols and stablecoins. The company is particularly interested in partnering with teams that are either preparing for launch or those looking to foster stablecoin growth from the outset.
Coinbase is inviting decentralized finance (DeFi) developers and smart contract projects that wish to integrate USDC to apply for the USDC Bootstrap Fund. The focus is on teams that are creating innovative products, utilizing USDC, and managing risks effectively.
Coinbase’s Bootstrap Fund: Catalyzing Early-Stage DeFi Liquidity And USDC’s Growth
In 2019, following the launch of USDC, Coinbase established the Bootstrap Fund to support DeFi developers in building liquid marketplaces from the outset. The fund played a pivotal role in providing initial on-chain liquidity for USDC across a range of DeFi platforms, including Uniswap, Compound, and dYdX, thus helping to foster strong liquidity during the early stages of DeFi development. Through this initiative, the USDC Bootstrap Fund invested directly into smart contract protocols, offering crucial early liquidity to entrepreneurs and developers seeking to scale their protocols.
USDC, or USD Coin, is a stablecoin—an asset designed to maintain a consistent 1:1 peg with the US dollar. Each USDC token is backed by US dollar assets held in reserve, such as cash and short-term Treasury securities, stored in regulated financial institutions in the US Initially launched as part of the Centre Consortium, a collaboration between Circle and Coinbase, USDC was later governed solely by Circle after the dissolution of the Centre Consortium in 2023.
From its beginnings, USDC has grown to become a dominant stablecoin in the DeFi space, with an estimated $8.9 billion in Total Value Locked (TVL) and $2.7 trillion in annual on-chain volume. Today, USDC supports various ecosystems, including Ethereum, Base, Solana, Hyperliquid, Sui, and Aptos, among others. Coinbase remains committed to further driving the adoption of stablecoins.
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