Coinbase Revives Stablecoin Fund to Boost USDC Liquidity in DeFi

Coinbase has relaunched its Stablecoin Bootstrap Fund, a strategic initiative first introduced in 2019, to enhance the liquidity of USDC across a range of decentralized finance (DeFi) protocols. The fund, managed by Coinbase Asset Management (CBAM), will initially allocate USDC liquidity to Ethereum-based lenders Aave and Morpho, as well as Solana-based trading platforms Kamino and Jupiter. This move aims to ensure users can access stable and reliable rates across both established and emerging DeFi protocols [2].

The initiative marks a continuation of Coinbase’s broader efforts to support the growth of USDC, a stablecoin co-created with Circle Internet Financial and now valued at $65.6 billion in market capitalization. Despite the dominance of Tether’s USDT, which holds a $164.6 billion market cap, Coinbase remains a key player in USDC’s ecosystem and has seen a 12% increase in stablecoin-related revenue, reaching $332 million in the most recent quarter [2].

Coinbase’s decision to revitalize the fund comes as part of its broader strategy to expand its onchain services. The company has also announced plans to integrate a decentralized exchange and rebranded its Coinbase Wallet to the “Base app,” signaling a shift toward becoming an “everything app” that combines social features, payments, and trading [2]. These moves reflect the company’s response to a broader market shift, including a 26% drop in total revenue during the second quarter and declining trading volumes.

The fund’s revival also builds on previous successes. In 2019, the initial $1 million allocations to Compound and dYdX helped establish USDC as a foundational stablecoin in DeFi. The company plans to expand this approach by injecting liquidity into more protocols, including those at the pre-launch stage, to drive stablecoin growth from the outset [2].

Coinbase’s chief business officer, Shan Aggarwal, emphasized the strategic importance of the move, noting that it is part of a broader effort to accelerate onchain adoption and support the growing demand for reliable DeFi services. While the fund will primarily focus on USDC and EURC, Aggarwal indicated the possibility of expanding to other stablecoins in the future [2].

USDC’s growing presence across multiple blockchains—including Ethereum, Base, Solana, and Sui—further underscores its role in the evolving DeFi landscape. With USDC’s total volume now surpassing $5.9 trillion, the stablecoin continues to solidify its position as a key player in the broader crypto economy [7].

By injecting liquidity into DeFi protocols, Coinbase aims to strengthen the infrastructure of onchain finance and support the continued adoption of stablecoins in decentralized markets. The company’s strategy reflects its long-term vision to become a comprehensive onchain platform, offering a range of services from tokenized stocks to prediction markets and early-stage token sales [2].

Sources:

[2] The Block – [https://www.theblock.co/post/366656/coinbase-stablecoin-liquidity-aave-morpho-kamino-jupiter-new-bootstrap-fund](https://www.theblock.co/post/366656/coinbase-stablecoin-liquidity-aave-morpho-kamino-jupiter-new-bootstrap-fund)

[7] PYMNTS.com – [https://www.pymnts.com/earnings/2025/circle-usdc-volume-hits-6-trillion-dollars-race-first-mover-advantage/](https://www.pymnts.com/earnings/2025/circle-usdc-volume-hits-6-trillion-dollars-race-first-mover-advantage/)