Coinbase intends to launch its Bitcoin Yield Fund on May 1, 2025, targeting institutional investors outside the United States. The fund, announced in a blog post on April 28, is aimed to provide yearly net returns on Bitcoin assets ranging from 4% to 8%, in response to a growing hunger for passive income alternatives in the crypto field.

 The fund will employ a cash-and-carry strategy, capitalizing on the price differential between spot Bitcoin and its derivatives to create returns.  Aspen Digital, an Abu Dhabi-based digital asset manager regulated by the Financial Services Regulatory Authority, is one of the initiative's proponents.

Source: Coinbase

By focusing on a market-neutral approach, the fund aims to reduce the investment and operational risks often associated with Bitcoin yield products — making it a more attractive option for institutions wary of crypto’s traditional volatility.

The timing of the launch couldn’t be better. Institutional interest in cryptocurrency is increasing. According to a recent survey by Coinbase and EY-Parthenon, 83% of institutions plan to increase their crypto allocations in 2025, with many seeing it as a major opportunity for strong risk-adjusted returns over the next three years.

Bitcoin’s performance reflects this growing interest. Over the past week alone (leading up to April 28), Bitcoin's price surged by more than 9%, fueled largely by institutional activity. Notably, crypto ETF inflows reached over $3 billion, which was their second-highest week on record.

Coinbase's Bitcoin Yield Fund is poised to satisfy this spike in institutional demand, providing a new, organized avenue for large investors to engage with Bitcoin beyond merely purchasing and holding.