Coinbase Announces Second Round of Stablecoin Bootstrap Fund
On August 12, Coinbase announced the launch of the second round of its “Stablecoin Bootstrap Fund,” aimed at enhancing the liquidity of stablecoins within DeFi. The initial funding will be allocated to four platforms: Aave, Morpho, Kamino, and Jupiter. This marks Coinbase’s new initiative six years after it first launched a similar fund in 2019.
Ensuring More DeFi Protocols Have Funds to Borrow and Tokens to Trade
Shan Aggarwal, Coinbase’s Chief Business Officer, stated that this funding will be used to “deploy capital within on-chain protocols,” such as replenishing liquidity pools of lending protocols, enabling users to borrow funds. He emphasized that the goal of this fund is to ensure that major protocols have sufficient stablecoin liquidity and stable interest rates.
This initiative will primarily focus on Circle-issued USDC and EURC stablecoins, with the possibility of including other stablecoins in the future. As for the actual scale of the fund, Aggarwal refrained from disclosing details.
Continuing the 2019 Round One Fund Initiative
Coinbase first launched its initial bootstrap fund in 2019, investing $1 million each into the lending platform Compound and the decentralized exchange dYdX. In 2020, it further supported Uniswap and PoolTogether with an additional investment of $1.1 million each. These early deployments successfully helped USDC establish a foothold in the DeFi ecosystem, and USDC is now widely used across mainstream ecosystems on Ethereum, Base, Solana, Hyperliquid, Sui, Aptos, and more.
Aggarwal stated, “Now is a critical turning point for the adoption of on-chain financial services.” He noted that the first round of funding helped establish initial liquidity for USDC, while this initiative aims to further expand the promotion of asset onboarding and the widespread application of stablecoins.
Coinbase’s Strategic Upgrade in DeFi: Aiming to Become an All-in-One Exchange
Recently, Coinbase has significantly accelerated its DeFi initiatives, having just announced the integration of DEX, allowing users to trade “millions of” digital assets previously inaccessible on Coinbase. This move is perceived as a strategic adjustment in response to the decline in spot trading volume and revenue in Q2.
Coinbase has also revealed its aspiration to become an “Everything Exchange,” where users can trade not only cryptocurrencies but also tokenized stocks, prediction markets, and even early token sales.
(Coinbase’s Q2 EPS reached 5.14, largely attributed to Circle and Bitcoin)
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