Y Combinator (YC), the "premier startup incubator" that successfully nurtured Airbnb, Stripe, and Coinbase, announced on February 3 that starting from the Spring 2026 batch, funded startups can choose to receive their $500,000 investment in the form of the USDC stablecoin. This marks the first time YC has officially announced the option to invest using stablecoins.

From Spectator to Participant

When YC invested in Coinbase in 2012, Bitcoin's price was only between $5 and $13. Over the next 14 years, although YC invested in nearly 100 crypto companies, the investment funds were still transferred via traditional bank wires.

A key reason for YC's change is the passage of the U.S. "GENIUS Act" in July 2025. This act established a federal regulatory framework for stablecoins, requiring 1:1 reserve backing and granting holders redemption rights. The arrival of regulatory clarity removed the biggest obstacle for top-tier institutions to adopt cryptocurrency. Just 7 months later, YC announced the stablecoin payment option.

The true significance of this move lies in YC "using" stablecoins itself. When an institution is willing to migrate its core business processes to new technology, it is a true vote of confidence. From investor to user, from spectator to participant, YC has completed a thorough role transformation over 14 years.

Why Choose Stablecoins?

The benefits of using stablecoins for investment first lie in efficiency. Consider an Indian startup receiving a $500,000 investment from YC: if using a traditional wire transfer, it might cost thousands of dollars in fees and take 3 to 7 days; if using USDC, the cost is nearly zero, and the funds arrive in 1 second.

Furthermore, YC's decision is based on a practical assessment: the new generation of entrepreneurs is already "Crypto Native." YC's statement pointed out that the practical application of stablecoins is growing among its portfolio companies, especially in markets like India and Latin America.

Startups including Aspora and DolarApp are already using stablecoins to help customers transfer and store funds more efficiently in regions where traditional banking infrastructure is limited or costly. To align with this trend, YC specifically emphasized support for stablecoins on the Ethereum, Base, and Solana public blockchains, allowing global entrepreneurs to choose the payment path that best suits them.

Why Choose USDC?

Keen observers have noted that YC did not vaguely refer to using stablecoins in general but specifically named USDC. Although USDC's market capitalization is smaller than USDT's, it is issued by Circle, a US-based company regulated by the Federal Reserve and state authorities. As a benchmark for Silicon Valley venture capital, YC must ensure every dollar complies with U.S. regulatory requirements.

And let's not forget, YC invested in Coinbase back in 2012. Coinbase is one of the co-founders of USDC. Moreover, Nemil Dalal, the YC partner overseeing crypto initiatives, was previously a Product Director at Coinbase. This "kinship" relationship might also naturally lead YC to trust and support the USDC ecosystem more.

VC's "Nokia Moment"

Actually, using stablecoins is not new in the crypto VC circle; firms like Paradigm or a16z Crypto have long been using them on a "case-by-case" basis. But YC's breakthrough lies in this: it is the "godfather of mainstream VC," and over 90% of its investments are in AI, enterprise services, or consumer goods, not cryptocurrency companies.

Previously, VCs used stablecoins often as a "last resort" when founders couldn't open dollar accounts; now, YC proactively includes this option in the standard contract template for every founder. Whether you're working on large models or biomedicine, if you want, you can directly receive USDC. This process-oriented, standardized move signals that the venture capital industry is facing its own "Nokia moment"—traditional transfer models are being outcompeted.

Will Other VCs Follow Suit?

Currently, top Silicon Valley VCs' attitudes towards crypto are diverging. a16z crypto represents the "radical faction," having raised $15 billion in early 2026 to focus on AI and crypto; YC represents the "pragmatic faction," entering through payments, not radical but extremely steady.

More traditional VCs might still be watching and waiting, but history provides a clear reference. Traditional financial institutions typically take 3 to 5 years to move from skepticism to embrace: both Goldman Sachs and JPMorgan Chase went from calling it "fraud" to launching related services.

According to an a16z report, currently 90% of financial institutions are integrating stablecoins. Stablecoin transaction volume reached $46 trillion in 2025, nearly three times that of Visa. Market forecasts predict the stablecoin circulating supply will exceed $1 trillion in 2026. Behind these numbers is an irreversible trend. YC's decision might just be a node in the stablecoin wave.

What Kind of Entrepreneurs Is YC Looking For?

Currently, applications for YC's Spring 2026 batch are open. The program will run from April to June in San Francisco. The application deadline is February 10 at 12:00 PM Pacific Time. Applications submitted before the deadline will receive results by March 13.

In September 2025, YC launched the "Fintech 3.0" initiative in collaboration with Base and Coinbase Ventures, highlighting a desire to fund on-chain startup projects in the following areas: stablecoin applications, tokenization and trading (new credit markets, on-chain capital formation, new trading interfaces), and Apps and Agents (including social, financial, collaborative, gaming, etc.).

14 years ago, YC investing in Coinbase was betting on the future; 14 years later, YC using USDC is becoming the future.