Coinbase users can now borrow USDC against bitcoin at a fixed rate
- Coinbase now offers fixed-rate loans that let users borrow the USDC stablecoin against their bitcoin, with interest rates and repayment dates set at origination.
- The loans run on Morpho Midnight, a noncustodial lending protocol, and settle on Base, Coinbase’s Ethereum layer 2 network.
- The product complements Coinbase’s variable-rate lending business, which has more than $1.4 billion in active loans backed by nearly $3 billion in collateral.
Nasdaq-listed exchange Coinbase COIN now allows its users to borrow dollar-pegged stablecoin USDC agains their bitcoin
The exchange has rolled out fixed-rate, bitcoin-backed USDC loans, with the interest rate and repayment date set at the time of borrowing, an alternative to the floating-rate loans Coinbase already offers.
“The move takes onchain borrowing beyond the predominantly variable-rate model, giving users greater certainty over the cost and duration of their borrowing,” according to an announcement on Tuesday.
The fixed-rate offering runs on Morpho Midnight, a decentralized, non-custodial lending protocol for fixed-rate and fixed-term crypto loans launched in July this year. It settles transactions on Coinbase’s Ethereum layer 2 network Base.
It marks a meaningful shift from how Coinbase’s lending has worked until now. It’s existing loans run on the Morpho Blue protocol, where rates change, determined by demand and supply conditions and can climb when borrowing demand spikes. The new fixed-rate option sits alongside this floating one, which has more than $1.4 billion in active loans backed by nearly $3 billion of collateral.