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- Coinbase has relaunched the Stablecoin Bootstrap Fund in order to improve the liquidity of USDC on DeFi platforms such as Morpho and Aave.
- The fund aims to provide stable rates and boost USDC’s growth across both mature and emerging DeFi protocols.
- USDC-related earnings rose 12% in Q2, highlighting the stablecoin’s growing significance in the crypto ecosystem.
Coinbase has reintroduced its Stablecoin Bootstrap Fund so USDC can be more liquid on popular and up-and-coming decentralized finance (DeFi) protocols. However, Coinbase said that the fund will also improve USDC in more established platforms like Aave and Morpho, as well as more recent platforms such as Kamino and Jupiter. Company considers that this effort will strengthen the role of USDC in the DeFi landscape.
During the fund’s initial rollout, liquidity will be injected into the Ethereum ecosystem’s lending protocols Aave and Morpho, as well as the Solana-based exchange platforms Kamino and Jupiter.
According to Coinbase, it is prepared to collaborate with pre-launch teams in order to provide assistance with stablecoin development on the day of launch. Growth of the fund will provide liquidity to stablecoins and additional protocols as it matures.
Coinbase Boosts USDC Liquidity in DeFi
Coinbase Asset Management will allocate the funds. The aim of the fund is to offer stable rates to users on both mature and emergent DeFi protocols. Coinbase did not reveal the amount of the fund, however, its aim consists of more liquidity where it is needed most in the DeFi sector. The decision is regarded as a strategic initiative to propel USDC growth to diverse blockchain ecosystems.
Along with Circle Internet Group, Coinbase played a crucial role in developing USDC. Although Tether is the leading stablecoin in the market. Coinbase’s efforts seek to elevate the usage of USDC by crypto traders and loan borrowers. The market capitalization of USDC is $66.25 billion, while Tether’s market capitalization is $164.6 billion, according to CoinGecko data. Coinbase strategy has the potential to make USDC more powerful in DeFi.
Also Read: Bithumb Tightens Coin Lending Rules as Regulators Target Excessive Crypto Leverage
Aave and Lido Lead DeFi TVL as USDC Gains Momentum
The total value locked (TVL) of DeFi protocols consists of $156.538 billion, where Aave and Lido receive the top two positions with $41.455 billion and $40 billion, according to DefiLlama. The Stablecoin Bootstrap Fund was established in 2019 to provide assistance to Ethereum-based DeFi projects, including Uniswap, Compound, and dYdX. This involved the allocation of $1 million to Compound and dYdX. In order to establish USDC as one of the most significant stablecoins in DeFi.
Source: DefiLlama
Coinbase reported revenue of $1.5 billion in Q2 yesterday, which was below the expectations of analysts. Nonetheless, USDC-related revenues increased by 12 percent to $332 million. Which further points to the significance of stablecoins in the company structure.
Coinbase is also developing a super app and rebranding its Coinbase Wallet into the Base app. The application integrates social, chat, payments, and trading. It remains in beta but is designed to present a complete solution to crypto users and encourage innovation and economic freedom growth.
The relaunching of the Stablecoin Bootstrap Fund by Coinbase is a sign that it is serious about the expansion of USDC within DeFi. The growth of the fund and its partnership with pre-launch teams might firmly establish USDC in the decentralized finance sector.
Also Read: Ethereum Reserve Expansion Sees FG Nexus Deploy $200M in ETH
