Coinbase Unveils Bitcoin Yield Fund for Institutions

Crypto exchange Coinbase is rolling out a new Bitcoin-focused feature that will cater to institutional investors outside the US.

The product, Coinbase Bitcoin Yield Fund (CBYF), will launch on May 1. The product will offer between 4% and 8% annual net returns on Bitcoin holdings.

Coinbase shared the news in a blog post. It noted that the fund will cater to the growing demand for Bitcoin yield products among large-scale investors. The fund is not available to U.S.-based investors. Instead, it focuses on global institutions looking for secure exposure to Bitcoin yield.

In addition, it will use a cash-and-carry strategy, generating yield from the price gap between Bitcoin’s spot and futures markets.

Unlike Ethereum or Solana, Bitcoin doesn’t support staking. This has made it harder for Bitcoin holders to earn yield without taking on extra risk. CBYF aims to solve that by offering a low-risk structure that better fits institutional needs.

Coinbase says the fund is already backed by several investors, including Aspen Digital, a regulated digital asset manager based in Abu Dhabi.

Coinbase pushes back against IRS data request

In separate news, Coinbase has gotten involved in a U.S. Supreme Court case involving digital privacy. The crypto exchange is challenging a 2016 IRS request that sought transaction records from hundreds of thousands of users.

Coinbase believes the government exceeds its limits by seeking such data, warning that it could set the wrong precedent in crypto. The IRS, under Donald Trump’s first administration, argued that it should have access to financial records once shared with third-party sites like Coinbase.

However, Coinbase pushed back against the claim, describing it as too broad. Coinbase is seeking court intervention to prevent the IRS from running wide-reaching searches.

Coinbase isn’t alone in challenging the IRS over user data. In 2020, Bitcoin researcher James Harper sued the agency. He claimed it overstepped by seizing information that identified him as a crypto holder.

Although a federal court ruled in 2023 that the IRS acted within its authority, the case has now reached the Supreme Court. Together, Harper’s challenge and Coinbase’s legal push could shape how far the government can go in accessing data shared with crypto platforms.

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