Key Takeaways
- Coinbase is launching a Bitcoin Yield Fund offering 4–8% annual returns.
- The fund uses a low-risk cash-and-carry arbitrage strategy with no bitcoin lending.
- Only non-U.S. institutional investors can access the fund, starting May 1, 2025.
Coinbase Asset Management will launch a new Bitcoin Yield Fund (CBYF) for institutional investors outside the U.S., offering net annual returns of 4% to 8% paid in bitcoin.
The fund opens on May 1, 2025, with monthly bitcoin-based subscriptions and redemptions.
Investment strategy
The fund aims to solve Bitcoin’s lack of native yield-generating mechanisms by using a conservative cash-and-carry arbitrage strategy.
This method profits from the price difference between bitcoin’s spot price and its perpetual futures contracts, particularly during bullish markets.
Coinbase wrote in its announcement:
Bitcoin yield funds have emerged to address this limitation, but these funds generally require institutional allocators to take on significant investment and operational risk.
Risk management
CBYF avoids high-risk strategies such as bitcoin lending or systematic call selling.
It won’t move bitcoin out of storage and instead uses third-party custodians for trading, reducing counterparty risk.
While minimal leverage may be used, the fund is structured to maintain a low-risk profile.
Institutional interest
Sebastian Bea, President of Coinbase Asset Management, said:
We believe the Bitcoin Yield Fund is particularly well suited to the task, given its conservative and compliant investment strategy.
Following the announcement, on-chain analytics showed an increase in bitcoin transfers to exchanges, possibly signaling institutional interest ahead of the fund’s launch.
Market outlook
Bitcoin remains above $90,000, with analysts eyeing a breakout past the $94,000–$95,000 resistance.
Ryan Lee of Bitget noted that a surge past $100,000 could trigger a wave of retail interest.
