tl;dr
Coinbase has launched a second Stablecoin Bootstrap Fund to provide additional liquidity for the DeFi ecosystem using USDC. The fund initially supports protocols like Aave, Morpho, Kamino, and Jupiter and invites other projects seeking liquidity to collaborate. Building on the success of its 2019 Bo...
Coinbase has launched a second Stablecoin Bootstrap Fund aimed at providing additional liquidity for the decentralized finance (DeFi) ecosystem using USDC. Announced on August 12, the initiative focuses on supporting protocols across several blockchains, beginning with Aave, Morpho, Kamino, and Jupiter. Coinbase has also encouraged other protocols seeking liquidity to reach out for potential collaboration. This fund marks Coinbase’s renewed effort to accelerate stablecoin adoption across both mature and emerging DeFi protocols, building on the success of its original 2019 Bootstrap Fund.
The first Bootstrap Fund played a pivotal role in establishing USDC marketplaces within leading DeFi protocols like Uniswap, Compound, and dYdX during the early development of DeFi. USDC has since risen to become the leading stablecoin in DeFi, boasting approximately $8.9 billion in total value locked (TVL) and an annual on-chain transaction volume of $2.7 trillion. A Coinbase spokesperson noted that current market conditions and growth opportunities make this an ideal moment to rekindle efforts to boost on-chain stablecoin liquidity, crediting the original fund with driving the initial wave of adoption.
Among the motivations for the new fund is the record-breaking $40.7 billion in active DeFi loans, which exemplify the surge in crypto-backed borrowing. However, the spokesperson emphasized that this is just one facet of the fund’s broader goal: to deepen liquidity for stablecoins throughout the on-chain ecosystem, ensuring users can access reliable borrowing and lending rates across both well-established and new protocols.
Looking ahead, Coinbase plans to scale the Bootstrap Fund over time, extending liquidity support to more protocols and stablecoins beyond the initial participants. By injecting additional liquidity into top decentralized money markets, the fund aims to reduce borrowing costs for USDC, making it more attractive for on-chain leverage and potentially drawing more capital onto blockchain networks. The company expressed a strong interest in partnering with pre-launch teams and early-stage projects to foster stablecoin growth from the ground up. As the spokesperson put it, “We believe now is the time to build, and the Stablecoin Bootstrap Fund is here to inject liquidity in projects that can make an impact on the ecosystem no matter the size.”