Coinbase Tokenizes Bitcoin Yield Fund on Base

Coinbase has partnered with financial Apex Group to bring its Bitcoin production fund to the base blockchain by launching a tokenized share division for the fund.

Apex said in a statement on Thursday that the tokenized share unit of Coinbase Asset Management's fund “is set to interact with compatible platforms, wallets, and infrastructure.”

Anthony Basile, president of Coinbase Asset Management, said the share class “integrates identity and eligibility at the token level” for regulatory compliance.

Financial institutions are decentralizing stocks, bonds, funds, commodities and real estate on the blockchain in search of lower costs, faster settlement and around-the-clock trading.

Asset managers such as BlackRock, Fidelity Investments and Franklin Templeton have acquired tokens on the chain.

Apex allows institutions to acquire ERC-3643 tokens

Coinbase's token share portion of the fund, which provides exposure and yield to Bitcoin (BTC), is available only to institutional and accredited investors outside the US.

The share class uses the ERC-3643 permissioned token standard to ensure that only qualified investors can access the Bitcoin product.

Coinbase plans to launch a tokenized share portion of the Coinbase Bitcoin Product Fund for future US investors.

Related: SEC Gives Go-ahead for Nasdaq Tokenized Trading Trial

Apex serves as an on-chain transfer agent for the tokenized Coinbase Bitcoin Yield Fund, and is responsible for handling token ownership, enforcing compliance and transfer rules, and maintaining a record of transactions on the Base blockchain.

Coinbase launched a US version of its non-US Coinbase Bitcoin product fund in April and October.

The non-US version targets 4% to 8% annual returns on Bitcoin. Coinbase says it launched the product to address Bitcoin's inability to generate a native product unlike proof-of-stake assets like Ether (ETH) and Solana (SOL).

Magazine: Are DeFi devs liable for their illegal actions on other platforms?