Coinbase has invested in ProShares’ GENIUS Money Market ETF, as stablecoin issuers prepare for stricter reserve rules under the GENIUS Act.
summary
- Coinbase invested in ProShares’ IQMM ETF to support stablecoin reserve management.
- The IQMM is designed to meet reserve requirements under the GENIUS Act.
- The Fund primarily holds short-term U.S. Treasury securities, cash and cash equivalents.
- Coinbase said the growth of stablecoins needs stronger tools for managing reserves and liquidity.
BlockBeats reported on June 2 that Coinbase will invest in… BroShares Boxknown as the IQMM indicator. The product is designed to serve as a money market ETF that could qualify for use as a stablecoin reserve under US stablecoin law, the report said.
The move puts Coinbase deeper into the reserve layer of the stablecoin market. To date, Coinbase has largely focused on stablecoin payments, distribution, developer tools, and cross-chain access. With IQMM, the company adds exposure to systems that manage assets backing dollar-pegged tokens.
Coinbase is moving towards stablecoin reserve tools
Coinbase said stablecoins have changed the way users, businesses, developers and AI agents move money by allowing instant settlement at any hour. The company also said that payment adoption needs a stronger backup infrastructure behind the tokens.
According to CoinbaseReserve management, liquidity management, issuance and redemption systems will become more important as stablecoins handle more payment and settlement activities. Stablecoin issuers need tools designed for these functions rather than relying solely on legacy banking and cash management channels, the company said.
IQMM gives Coinbase a place in this market segment. ProShares is bringing ETF infrastructure expertise to the fund, while Coinbase is offering the investment as part of its attempt to support the full spectrum of stablecoins.
IQMM targets the GENIUS Act fallback standards
ProShares designed IQMM around assets that comply with the reserve framework established by the GENIUS Act. The law requires payment stablecoins to be individually backed by high-quality, highly liquid assets.
The Fund primarily holds short-term U.S. Treasury securities with remaining maturities of 93 days or less. It also includes cash and cash equivalents. According to the report, this structure is intended to meet the Section 4 reserve requirements under the Act The law of genius.
BlockBeats described IQMM as the first money market ETF designed to serve as a reserve asset for a stablecoin. Products like IQMM can help issuers manage liquidity while creating and redeeming stablecoins, Coinbase said.
Stablecoin issuers are facing new reserve demands
The GENIUS Act was passed into law last year, creating a federal framework for the issuance of stablecoins in the United States. The law requires exporters to repay stablecoins Entirely with liquid assets such as Treasuries or cash.
However, the rules will not officially come into effect until at least early 2027. Regulators are still preparing detailed requirements for stablecoin issuers.
Coinbase said reserve assets could expand beyond direct treasury holdings as the sector develops. The company has listed ETFs, money market funds and cash-like products among the instruments that could back up future stablecoin reserves.
ProShares launched IQMM in February. The fund generated $17 billion in trading on its first day, according to market data provided.
Stablecoins provide a better way to move money, but the industry also needs better systems to manage the reserves that back them, Coinbase said. Its investment in IQMM expands this strategy to include the financial plumbing that supports stablecoin issuance, redemption, and liquidity.
