Coinbase Revives USDC Bootstrap Fund to Enhance Liquidity in DeFi Protocols Like Aave and Morpho

• Coinbase’s fund aims to boost USDC liquidity across various DeFi protocols.

• Initial placements include Aave, Morpho, Kamino, and Jupiter, enhancing user access to reliable rates.

• USDC’s market cap stands at $65.6 billion, significantly trailing Tether’s $164.6 billion.

Coinbase revives its Stablecoin Bootstrap Fund to enhance USDC liquidity in DeFi, aiming to attract more users. Learn more about this initiative now!

What is the Coinbase Stablecoin Bootstrap Fund?

The Coinbase Stablecoin Bootstrap Fund is an initiative designed to enhance the liquidity of USDC in decentralized finance (DeFi) protocols. Relaunched in 2023, it aims to support various platforms and foster stablecoin growth.

How does the fund operate?

The fund will deploy USDC liquidity into Ethereum-based lenders like Aave and Morpho, as well as Solana-based platforms such as Kamino and Jupiter. Coinbase Asset Management will oversee these deployments to ensure reliable rates across both established and emerging protocols.

Frequently Asked Questions

Why is USDC important in the crypto ecosystem?

USDC plays a crucial role in the crypto ecosystem, providing stability and liquidity. Its market cap of $65.6 billion makes it a significant player, second only to Tether.

How can users benefit from the Coinbase fund?

Users can benefit from enhanced liquidity and access to competitive rates across various DeFi platforms, making it easier to trade and borrow using USDC.

Key Takeaways

• Revival of the fund: Coinbase’s initiative aims to enhance USDC liquidity in DeFi.
• Initial support: The fund will support platforms like Aave and Morpho.
• Market impact: USDC’s market cap is growing, aiming to attract more users to the ecosystem.

Conclusion

The revival of the Coinbase Stablecoin Bootstrap Fund marks a significant step towards enhancing USDC’s liquidity in the DeFi space. With a focus on collaboration and support for various protocols, Coinbase aims to solidify USDC’s position in the market and drive growth in the crypto ecosystem.

Coinbase has revived its fund to boost USDC liquidity in DeFi, starting with supporting the stablecoin on Aave, Morpho, Kamino, and Jupiter.

Coinbase is relaunching its Stablecoin Bootstrap Fund first introduced in 2019 to boost the liquidity of the stablecoin USDC in a range of popular and emerging decentralized finance protocols.

Coinbase said on Tuesday its first placements will provide USDC (USDC) liquidity into Ethereum-based lenders Aave and Morpho, and Solana-based trading platforms Kamino and Jupiter.

“As we scale the fund over time and distribute liquidity across more protocols and stablecoins, we’re particularly eager to collaborate with pre-launch teams or those seeking to drive stablecoin growth from day one,” it added.

The deployments will be managed by Coinbase Asset Management and are designed to ensure users can “access reliable rates across mature and emerging protocols,” Coinbase said.

Coinbase did not disclose the size of the fund. Cointelegraph contacted Coinbase for comment.

Coinbase helped create USDC alongside its issuer, Circle Internet Group, but is still key to its ecosystem. Tether (USDT) dominates stablecoin volume across the crypto ecosystem, with an over $100 billion lead on USDC’s market capitalization, and Coinbase’s bid to boost USDC’s liquidity in DeFi could attract more crypto traders and borrowers to the token.

Total value locked in DeFi protocols currently sits at $165.4 billion, led by Aave and Ether (ETH) liquid staking protocol Lido at $41 billion and $40.8 billion, DeFiLlama data shows.

Blue chip DeFi protocols benefit from Coinbase’s first fund

The revival of Coinbase Stablecoin Bootstrap Fund comes six years after it was first introduced in September 2019 to assist Ethereum-based DeFi protocols such as Uniswap, Compound and dYdX with USDC liquidity.

The first of those funds deployed $1 million each to Compound and dYdX, which helped pave the way for USDC to grow into a popular stablecoin in DeFi after only launching a year earlier.

USDC now holds a market cap of $65.6 billion, trailing USDT at $164.6 billion, CoinGecko data shows.

Like most stablecoins, USDC is supported on several blockchains, including Ethereum, Base, Solana, Polygon, Aptos, Avalanche and Sui.

Coinbase’s total revenue down, but stablecoin revenue up

It comes as Coinbase reported $1.5 billion in revenue for the second quarter, falling short of industry expectations of $1.56 billion to $1.59 billion.

However, while revenue fell 26% from the previous quarter, its stablecoin-related revenue — primarily through USDC — rose 12% to $332 million.

Coinbase aims to be an “everything app”

Coinbase is aiming to launch a “super app” after rebranding its Coinbase Wallet to “Base app” on July 16, which the exchange said was to evolve it “from a wallet into an everything app that brings together social, apps, chat, payments, and trading.”

The app will aim to “expand economic freedom, creativity, and innovation,” Head of product for Base app, John Granata, said, adding that it could be a starting point for a new kind of social network.

The app is still in the beta stage.

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