Coinbase Offers Access to DeFi Yields With DAI and Compound

Cryptocurrency exchange giant Coinbase says its opening up decentralized finance (DeFi) to customers who want a slice of high yields earned from lending and borrowing crypto assets, starting with DAI, a stablecoin pegged to the U.S. dollar.

Coinbase customers’ DAI is then deposited with DeFi lending platform Compound Finance.

At first blush, the world of DeFi is the opposite of centralized exchanges like Coinbase. However, accessing DeFi protocols can mean paying expensive network fees and involve a somewhat complex user experience, Coinbase said in a blog post released Thursday.

“Today we’re introducing a new way for Coinbase’s global customers to put their crypto to work and earn yield. We are making DeFi more accessible, enabling eligible customers in more than 70 countries to access the attractive yields of DeFi lending on their Dai with no fees, lockups, or set-up hassle,” the Coinbase blog says.

During October of this year, Compound returned variable APY rates for supplying DAI that fluctuated between 2.83% and 5.39%, Coinbase added in the blog post.

“These higher rates reflect both the unique access to global liquidity and increased risk that can come with DeFi. Though Coinbase monitors these protocols regularly, we cannot guarantee against potential losses,” the blog states. (Coinbase did not make an executive available for an interview about the new service.)

Coinbase said a wider variety of assets and a greater number of DeFi protocols would follow.

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