Coinbase, the third-largest cryptocurrency exchange by trading volume, plans to launch an Institutional Fund on May 1, offering institutional investors outside the United States a new option to earn passive income from Bitcoin holdings.
The fund aims to deliver annual net returns between 4% and 8%, according to an April 28 announcement from Coinbase. The company said the fund was created in response to growing demand from institutional clients seeking income opportunities in the Bitcoin market.
Aspen Digital, a digital asset manager based in Abu Dhabi and regulated by the Financial Services Regulatory Authority, is among the investors backing the fund.
Coinbase said returns would be generated through a strategy that takes advantage of the price difference between Bitcoin’s spot market and its derivatives.
Unlike cryptocurrencies such as Ether and Solana, Bitcoin does not support staking, which has limited passive income opportunities for holders. The new fund seeks to fill that gap by offering a structured way to earn returns without the need for staking.
Coinbase, leading cryptocurrency exchange, will launch the Coinbase Bitcoin Yield Fund (CBYF) on May 1, 2025, targeting non-U.S. institutional investors. The fund aims to deliver 4-8% annualized returns through arbitrage between Bitcoin spot and perpetual futures markets,… pic.twitter.com/PY8CfgfXVP
— KAZEN (@KazenHQ) April 28, 2025
The company emphasized that many existing Bitcoin yield products expose investors to significant investment and operational risks. Coinbase said its fund is designed to better align with the lower risk appetite typical of institutional investors.
The launch comes at a time when institutional interest in cryptocurrencies is rising sharply. This trend may partly explain Bitcoin’s recent price recovery, which saw the asset climb more than 9% in the week leading up to April 28.
Based on the data from Farside Investors, Bitcoin exchange-traded funds recorded their second-highest week of inflows at more than $3 billion during the same period.
Bitcoin reached $94,000 last week, supported by strong ETF inflows and corporate buying, according to Ryan Lee, chief analyst at Bitget Research. Lee told Cointelegraph that retail interest has so far been slow but could pick up if Bitcoin breaks the $100,000 mark.
“Retail interest may surge if Bitcoin breaks $100,000, fueled by media hype and FOMO,” Lee said. He advised monitoring the $94,000 to $95,000 range closely for signs of retail investors returning to the market.
On April 21, BitMEX co-founder Arthur Hayes also pointed to upcoming U.S. Treasury buybacks as a potential catalyst for Bitcoin’s next price surge. Hayes described the current period as possibly the “last chance” to buy Bitcoin below $100,000.
With its new fund, Coinbase is positioning itself to meet rising institutional demand while offering a lower-risk option for investors looking to earn steady returns from Bitcoin exposure.
