- Coinbase’s Bitcoin Yield Fund targets 4–8% annual BTC returns for non-US institutions.
- The Bitcoin Yield Fund uses a cash-and-carry strategy, avoiding risky Bitcoin loans.
- Aspen Digital seeds Coinbase’s Bitcoin Yield Fund, focusing on UAE and Asia distribution.
Coinbase Asset Management announced the launch of the Coinbase Bitcoin Yield Fund (CBYF), set to begin operations on May 1, 2025. The fund is designed to expose Bitcoin to institutional investors outside the United States, aiming for an annualized net return between 4% and 8%.
Coinbase developed CBYF to meet the increasing demand among institutional allocators for Bitcoin yield opportunities. Unlike Ethereum and Solana, Bitcoin does not inherently generate passive income. To address this, the fund employs a conservative cash-and-carry investment strategy that captures yield from the difference between spot and futures prices without relying on high-interest Bitcoin loans or systematic call selling.
The fund allows investors to subscribe and redeem in Bitcoin with five business days’ notice each month. The company estimates the strategy’s capacity at $1 billion. Aspen Digital, a digital asset manager regulated by the Financial Services Regulatory Authority in Abu Dhabi, seeded the fund and will serve as the exclusive wealth distribution partner across the UAE and Asia.
Risk Management and Custody Framework for Bitcoin Investment
Coinbase Asset Management structured the Bitcoin Yield Fund to lower the investment and operational risks traditionally associated with similar products. Instead of moving assets from storage, the fund uses third-party custody integrations to execute trades, aiming to significantly reduce counterparty risk.
The fund utilizes qualified custodians to manage assets, maintaining strong security standards for institutional investors. By minimizing reliance on riskier lending practices and focusing on a structured derivatives strategy, CBYF aligns with the fiduciary requirements of many institutional clients.
Coinbase Asset Management, composed of Coinbase Asset Management, LLC and CBAM (Cayman) Ltd., manages the fund. The entities hold regulatory registrations with the SEC, CFTC, and CIMA. This regulatory framework strengthens the fund’s credibility in the institutional market.
Institutional Adoption Drives Bitcoin Market Momentum
The launch of the Coinbase Bitcoin Yield Fund coincides with increasing institutional adoption of digital assets. Over the past week, Bitcoin prices rose by more than 9%, reaching approximately $94,872. Analysts attribute this surge mainly to exchange-traded fund inflows and corporate Bitcoin purchases.
Data from Farside Investors reported over $3 billion in ETF inflows during the week ending April 28, 2025, marking the second-highest inflow week recorded. Industry experts suggest institutional interest drives Bitcoin’s price recovery, even as retail participation remains subdued.
Coinbase’s new product reflects a strategic effort to offer investment solutions tailored for institutions seeking secure, yield-generating Bitcoin exposure amid a rapidly maturing digital asset market.
