Coinbase Begins Backend Testing Of New USDF Stablecoin For Exchange

TLDR

• Coinbase begins backend testing of USDF stablecoin on its exchange platform.
• USDF is being developed using Coinbase’s Custom Stablecoin infrastructure.
• The stablecoin will be fully collateralized with USDC, Coinbase’s current partner.
• Trading and withdrawals for USDF are not yet available during this testing phase.

Coinbase, one of the largest cryptocurrency exchanges, has started backend testing for its new stablecoin, USDF. This marks the first step in a broader plan to expand its stablecoin offerings. As of now, trading, deposits, and withdrawals for USDF are not yet available, as Coinbase has initiated only operational testing. The company shared this development through its Coinbase Markets account on January 27, 2026.

This move signals Coinbase’s intent to further diversify its stablecoin strategy beyond its ongoing partnership with Circle, which is responsible for the widely used USDC stablecoin. USDF is designed to be fully backed by USDC, which means each token is collateralized with an equivalent amount of USDC. The token is being developed using Coinbase’s newly introduced Custom Stablecoin infrastructure.

USDF Testing Phase and Future Updates

The testing phase of the USDF stablecoin is currently limited to backend operations. According to Coinbase, the operational test is intended to evaluate the functionality and security of the new stablecoin within the exchange’s ecosystem. Trading, deposits, and withdrawals for USDF are expected to be unavailable during this phase.

Coinbase has emphasized that the operational test is just an initial step. The company has stated that more updates will be shared as the testing progresses and that it plans to expand its stablecoin offerings in the future. This testing phase also follows Coinbase’s broader efforts to improve its product suite, including expanding into new markets and offering additional tools to users.

Custom Stablecoin Infrastructure and Future of USDF

The development of USDF is part of Coinbase’s broader strategy to innovate in the stablecoin sector. The company introduced its Custom Stablecoin infrastructure late last year. This framework allows for the creation of dollar-backed tokens that are fully collateralized by USDC.

USDF is one of the first stablecoins to utilize this infrastructure, with Coinbase using the backend testing phase to ensure it functions smoothly before any public launch.

With USDF, Coinbase aims to introduce a stablecoin that complements its existing partnership with Circle for USDC. The new stablecoin will provide additional options for users on Coinbase’s platform, potentially making it a valuable asset for trading and payments within the ecosystem.

Potential Impact of USDF on Coinbase’s Strategy

As Coinbase tests USDF, it signals the company’s broader ambitions in the cryptocurrency space. Coinbase has previously outlined plans to expand into new areas such as stock-linked products, perpetual futures trading, and prediction markets.

By introducing USDF, Coinbase appears to be strengthening its stablecoin and payments infrastructure, adding another layer of versatility for users.

While there is still much to be learned about the specific functionality and potential use cases of USDF, this backend test serves as a step towards greater diversification of Coinbase’s offerings. As the stablecoin market continues to grow, Coinbase’s move to develop USDF could position the company to better compete in this increasingly competitive space.

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