The asset management arm of exchange giant Coinbase (COIN) is taking its Bitcoin Income Fund on-chain, working with $3.5 trillion fund manager Apex Group to create a tokenized share class of the fund.
The Coinbase Bitcoin Income Fund is managed by Coinbase Asset Management (CBAM) and will be open to investors on the Base network, Coinbase’s Ethereum-based blockchain. Apex remains the transfer agent and maintains records consistent with the Fund’s NAV.
The launch comes as global asset managers are looking at tokenization as the next frontier in capital markets development, allowing bonds, stocks and funds to be traded on blockchain rails. Firms such as BlackRock (BLK), Fidelity and Franklin Templeton have launched tokenized funds in recent years aimed at speeding up settlement times, cutting costs and opening up new distribution channels.
Brett Tejpaul, head of Coinbase institutions, said that the company’s asset management business has allocated a large amount of institutional capital, and many investors hold core positions in Bitcoin and Ethereum.
“We’re gradually attracting new capital into the space that’s looking to compound returns, so they’re betting not just on the appreciation of Bitcoin, but while they’re waiting for the price of Bitcoin to go up, they’re earning along the way,” he told CoinDesk.
“The Bitcoin Income Fund allows them to do this by, for example, selling call options or participating in loan facilities.”
Tokenized assets could be a multi-trillion dollar market, with estimates ranging from McKinsey’s projection of $2 trillion by 2030 to BCG and Ripple’s $18.9 trillion target by 2033.
Apex is a major player in the fund services business, supporting $3.5 trillion in assets and is increasingly leaning toward tokenization. It acquired Tokeny last year, a company that specializes in facilitating the tokenization of more than $32 billion in assets. Apex also said it plans to tokenize $100 billion in funds by June 2027 using T-REX Ledger to manage ownership and compliance across multiple blockchains.
In the case of the Coinbase Bitcoin Income Fund, the tokenized share class uses the ERC-3643 token standard, which encodes investor checks directly into tokens. Only approved investors can hold or transfer assets, with identities tied to each wallet through a dedicated onboarding process.
This setup replaces manual compliance checks with automated rules. If the wallet is not emptied, the transaction fails. This can reduce friction for institutional investors to acquire and transfer fund positions.
The fund is available to non-U.S. investors, but CBAM said it also plans to create a U.S. version of the fund’s tokenized share class.
