Coinbase Joins S&P 500

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Good Morning.

Believe tokens are all the rage as the KOLs try to coin the term “Internet Capital Markets”. Are these just tokens associated with bootstrap projects but without any clear pathways to some sort of revenue share or buyback-and-burn? Maybe. Will I still ape? Trust your instinct.

In Today's Email:

• What Matters: Coinbase Joins S&P 500 🎉 

• Case Study: Apollo’s DeFi Looping Bet ➿ 

• Governance & Features: PumpSwap Adds Creator Revshare 🔎 

You read and share. We listen and improve. Send us feedback at [email protected].

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WHAT MATTERS

Coinbase Joins S&P 500

State of play: Coinbase has become the first crypto company to be added to the S&P 500 index, replacing Discover Financial. The inclusion, effective May 19, marks a major milestone for the crypto industry’s integration into mainstream finance.

• Following the announcement, Coinbase shares surged nearly 15%, adding over $8B to its market value.

• Analysts called the move a "watershed moment" for both Coinbase and the broader crypto sector, highlighting rising institutional credibility.

• This development comes as Coinbase strengthens its global footprint, including a $2.9B deal to acquire crypto derivatives platform Deribit.

• Coinbase's addition to the index could trigger up to $16B in combined passive and active fund inflows due to its estimated 0.1% weight in the S&P 500.

• CEO Brian Armstrong described the listing as a signal that "crypto is about to be in everyone’s 401k."

Why it matters: Despite a recent dip in Q1 profits, analysts remain bullish, raising price targets and emphasizing Coinbase’s strong positioning for future acquisitions and market expansion.

Our take: Passive flows from index funds are going to make COIN a very easy long.

For builders and investors: Make sure what you’re building is not just a feature that Coinbase can just launch in a few months.

CASE STUDY

Apollo’s DeFi Looping Bet

Credits to Steven Ehrlich & Unchained for the original article.

Apollo Global Management has partnered with Securitize and Gauntlet to bring DeFi-style leverage to its $1.3B Diversified Credit Fund through tokenization.

The initiative allows investors to use “sACRED” tokens, representing tokenized shares of Apollo’s credit fund, as collateral in a Morpho vault to borrow USDC, buy more sACRED, and repeat the process.

• This looping mechanism, common in DeFi, aims to deliver yields around 16% by applying leverage to a traditionally illiquid asset class.

• Private credit has seen rapid growth, expected to double from $1.5T in 2024 to $3T by 2028.

• While the asset class offers strong historical returns, it’s typically hard to access or redeem.

• Apollo’s fund is structured as an interval fund, offering redemptions only quarterly, capped at 5%.

• Yet, Securitize initially advertised daily liquidity, which was later quietly changed after questions about the mismatch.

The model also raises concerns about liquidation. Unlike liquid crypto assets, sACRED tokens can only be sold to pre-approved parties.

• Gauntlet claims crypto prime brokers will step in to manage defaults, though they must hold the illiquid tokens until redemptions open.

• A similar ETF attempt with Apollo earlier this year struggled to attract capital despite novel liquidity agreements.

• Tokenization may improve access and composability, but it doesn’t eliminate core risks around redemption, transparency, and market depth.

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INSIGHTS

Believe & LaunchCoin: Internet Capital Markets

Believe App and LaunchCoin are creating a new on-chain fundraising model where ideas can be tokenized instantly by tagging LaunchCoin on X.

• This lets anyone test market demand directly on social media.

• If a tagged idea gains enough traction to hit a $100K market cap, it graduates to a full token generation event (TGE).

• Fees generated are split 50/50 between creators and the platform.

So far, over 2,600 tokens have launched, generating $313M in volume and $1.7M in daily fee earnings, showing strong early traction.

• The launch mechanism acts like a flywheel: tagging generates curiosity, which brings in liquidity, fueling more launches.

• However, questions remain around long-term sustainability, especially without a built-in revshare for holders.

• It's an experiment in internet-native capital formation, part social layer, part funding engine.

Watch the full product overview here

FEATURES & GOVERNANCE UPDATE

PumpSwap Adds Creator Revshare

PumpSwap, the DEX tied to memecoin launchpad PumpFun, has launched a revenue-sharing program that gives 50% of protocol earnings to token creators. This equates to a 0.05% fee (in SOL) per eligible transaction.

• Based on April 2025’s $11.2B volume, creators could have earned $5.6M.

• Critics argue it rewards abandoned or rug-pulled projects and undermines community-driven takeovers.

• PumpSwap now charges 0.3% per swap, including this new creator fee.

Other notable feature updates:

• Yield launches YO on Base.

• Fluid launches sUSDS on Arbitrum.

• Plume Network launches Plume Alpha.

• Berachain Foundation approves the latest batch of RFRVs.

• Sky’s upgrade from MKR to SKY has passed the governance poll.

QUICK BITES

• Tether supply crosses the $150B mark.

• DeFi Development Corp adds 172,670 SOL.

• Robinhood to acquire WonderFi for around $179M.

• Yuga Labs sells CryptoPunks Ethereum IP to a nonprofit.

• VanEck, Securitize launch tokenized US Treasury fund.

• Twenty One Capital purchases $458.7M worth of Bitcoin.

• PumpSwap introduces revenue-sharing for token creators.

• Etoro prices Nasdaq debut at $52, surpassing expectations.

• Coinbase becomes the first crypto company to be added to the S&P 500.

• FalconX partners with Standard Chartered to boost institutional offerings.

• Synthetix proposes a $27M token swap to acquire Derive options protocol.

• Galaxy Digital finalizes US move ahead of planned Nasdaq listing this week.

• London-based asset manager buys nearly $500M worth of ETH in six days.

NOTEWORTHY READS & MEME

• Daveeemor’s read on the Grass protocol.

• Decentralised’s read on the inevitability of MEV.

• Coinmetrics’ read on the stablecoin sector analysis.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.