Overview

Coinbase is launching bitcoin-backed loans to its U.S. customers through Morpho, a prominent lending platform on its Base network. This new offering allows users to use substantial collateral instead of their credit scores to access loans.

Key Points

• Introduction of Bitcoin-Collateralized Loans: Coinbase will offer users the option to secure loans against their bitcoin holdings, eliminating the reliance on credit ratings.
• Enhanced Accessibility: By integrating Morpho’s lending services into its platform, Coinbase simplifies the borrowing process for its clients.
• CEO's Insight: Max Branzburg stated, "This is a moment where we’re planting a flag that Coinbase is coming on-chain, and we’re bringing millions of users with their billions of dollars."

How It Works

Borrowers must present considerable amounts of bitcoin as collateral, with loans capped at $100,000 in USDC. Morpho will monitor the loan-to-value ratios and issue liquidation warnings through the Coinbase app if needed.

Implications

This initiative not only broadens Coinbase’s product range but also caters specifically to cryptocurrency traders who prefer leveraging their assets rather than liquidating them for cash. The interconnection between Morpho and Coinbase’s extensive user interface represents a significant advancement in the crypto lending space.