Coinbase announced that it is investing $2 million in the USDC Bootstrap Fund to expand the Decentralized Finance (DeFi) ecosystem. Coinbase announces USDC Bootstrap Fund for DeFi Projects.
DeFi, or Decentralized Finance, is the latest trend in blockchain space. DeFi projects are traditional financial products that would be expected from a conventional bank that is built on top of a blockchain, such as loan protocols and derivatives.
The USDC is a dollar-pegged stablecoin introduced by Coinbase in collaboration with Circle Crypto Finance.
The company said that the Fund would support the development of DeFi protocols by investing USDC directly in the protocol.
The bootstrap fund will add to the lending pools of protocols and return interest when counterparties borrow from it. That is unlike Coinbase Ventures, which invests in startups and takes an equity stake.
Coinbase announces USDC Bootstrap Fund for DeFi Projects. The Bootstrap Fund aims to make it simpler for developers to launch their protocol by leveraging USDC to assist them to generate healthy, liquid markets.
Coinbase is also announcing its first two investments through the USDC Bootstrap Fund. The company is adding 1 million in USDC to Compound, and 1 million in USDC to dYdX.
“Through the investment of USDC, our goal over time is to support DeFi teams in making their products safer, and more reliant and accessible than existing financial products,” the company blog said.