Y Combinator Backs Web3 Startups with Base Partnership

Y Combinator’s announcement frames the current moment as a unique convergence of three critical factors that make on-chain finance viable at scale. The first is regulatory clarity, specifically citing the GENIUS Act, which established federal regulations for stablecoins. This legislative milestone has already catalyzed significant growth, contributing to a $30 billion expansion in the stablecoin market cap and attracting interest from retail giants Amazon and Walmart, which are reportedly exploring launching their own stablecoins.

The second enabling factor is the maturation of Layer-2 (L2) blockchain infrastructure. Platforms like Base now offer transaction processing that is both sub-second and sub-cent, solving the scalability and cost issues that previously hampered blockchain adoption for mainstream finance. Base itself reports nearly $15 billion in platform assets, demonstrating the robust infrastructure now in place. The third pillar is overwhelming market demand. With an estimated 560 million crypto users globally and a staggering $30 trillion in stablecoin settlements processed last year—a 300% year-over-year increase—the user base and transaction volume necessary for sustainable business models are clearly present.

Y Combinator has identified three priority sectors for funding within its Fintech 3.0 initiative. The primary focus is on stablecoins, particularly dollar-pegged and local currency variants, which have proven the model for instant, low-cost global payments. Base already hosts over $4 billion in stablecoin value, including EURC, CADC, and IDRX, indicating a growing ecosystem for currency alternatives beyond the USD. The accelerator is seeking startups that build not only the stablecoins themselves but also the crypto-native commerce platforms that utilize them.

The second strategic area is the tokenization of traditional assets and the development of trading applications. This involves applying blockchain rails to assets like equities, enabling programmable ownership and global access to markets that were previously illiquid or inaccessible. Institutional validation for this sector is strong, exemplified by JPMorgan’s recent launch of USD-backed deposit tokens on Base via its Kinexys platform, a move that demonstrates the demand for instant settlement in traditional finance.

The third sector targets innovative applications and AI agents that operate on-chain. Y Combinator is backing companies building everything from on-chain social platforms to autonomous trading systems. The potential of this area is highlighted by Base’s own Clanker AI agent, which generated over $13 million in revenue in its first five months by enabling token launches through simple text commands. Other AI agents are being developed to execute complex trades and create prediction markets, automating financial services in unprecedented ways.

Throughout its announcement, Y Combinator emphasizes that the current regulatory environment is the crucial enabler that distinguishes this funding cycle from previous crypto booms. The accelerator argues that past regulatory uncertainty prevented the development of “generational companies” in the crypto space. Now, with federal frameworks like the GENIUS Act providing clear rules of the road, founders can pursue ambitious on-chain financial services with greater confidence in the longevity and legality of their ventures.

This partnership between a top-tier accelerator like Y Combinator, a leading L2 platform in Base, and a major venture arm in Coinbase Ventures, all converging on the same thesis, marks a significant inflection point. It suggests that the infrastructure, market demand, and regulatory support have aligned to create a fertile ground for the next wave of financial technology innovation, one that is fundamentally built on blockchain infrastructure.