U.S. cryptocurrency exchange giant Coinbase thinks Ethereum’s growing decentralized finance sector is promising, at least if the company’s continued support to top projects in the space is any indication.
On Wednesday, April 1st, Coinbase announced its USDC Bootstrap Fund invested 1 million USDC worth of liquidity into Uniswap — namely the decentralized exchange’s USDC/ETH pool — as well as 100,000 USDC into PoolTogether, a no-loss lottery game built on Ethereum that, like Uniswap, has quickly become something of a bright and early DeFi star.
Coinbase launched its USDC fund last year to invest directly into DeFi platforms via USDC, the dollar-pegged stablecoin the exchange backs alongside Circle. The fund’s first grantees were DeFi lending platforms Compound and dYdX, which respectively received 1 million USDC of liquidity in September 2019.
Accordingly, Coinbase’s new liquidity injections into Uniswap and PoolTogether brings the count of projects the USDC Bootstrap Fund has backed to four.
In announcing the fund’s new investments, Coinbase specifically hailed Uniswap as “increasingly becoming critical infrastructure for tokens and applications that need liquidity.” The exchange also noted its PoolTogether investment would raise the rewards paid out by the game’s daily USDC prize pool.
The news comes on the heels of USDC taking center stage in DeFi last month upon being voted in as the third accepted collateral type to MakerDAO, the biggest dApp in the decentralized finance arena to date. The addition was aimed at addressing an acute liquidity crunch around the Dai, MakerDAO’s own dollar-pegged stablecoin.
So USDC took the spotlight during a temporary DeFi crisis, but it won’t be the last time the stablecoin shines if Coinbase has anything to say about it.
“We encourage DeFi developers and smart contract projects that want to integrate USDC to apply for the USDC Bootstrap Fund,” the exchange said.
Going All In
Naturally, Coinbase is way ahead of the curve — or rather, the mainstream — when it comes to the cryptoeconomy, so it’s no surprise that the exchange is an early DeFi backer and sees the sector’s potential upside.
With that said, Coinbase is as well positioned as any firm when it comes to having the ability to bring, explain, and foster DeFi to the masses. And such efforts are precisely what the exchange has been doing as of late, too.
For instance, just last week the exchange unveiled new direct DeFi integrations inside its non-custodial Coinbase Wallet app. The move made it easier for users to access the Compound and dYdX projects.
“You can now compare different rates from providers, easily deposit your crypto without opening a web browser, and view your balances on a simple, unified dashboard,” Coinbase Wallet’s lead Sid Coelho-Prabhu said.
A few weeks prior to those integrations, Coinbase Wallet added support for a basic username system and the Ethereum Name Service (ENS), either of which make it easier for sending or receiving crypto around DeFi activities.
Moreover, the popular U.S. exchange has also undertaken more direct embraces of DeFi projects. For example, in February the company listed Kyber Network’s KNC tokens on Coinbase.com, Coinbase Pro, and its mobile apps. Kyber is one of the top DeFi exchange projects, and its token now joins the other DeFi projects already listed on Coinbase, e.g. 0x (ZRX), Augur (REP), Basic Attention Token (BAT), and the Dai.
Going off of what we’ve seen so far, one can be forgiven for assuming that Coinbase has plenty of more DeFi melds that will be rolled out in the months ahead, and likely through a variety of different avenues. The grand questions for now, then, are what forms will these further embraces come in and when will they arrive.