Coinbase (NASDAQ:COIN) is now offering crypto-backed loans in the United Kingdom.
According to a blog post, users may pledge crypto as collateral to gain access to USDC loans. Current assets available for collateral include BTC, ETH, and cbETH. Coinbase is working with Morpho to power the lending feature. For BTC-backed loans, users may borrow up to $5 million in USDC, contingent on the amount of Bitcoin they pledge as collateral.
Interest rates are variable and calculated by Morpho based on market conditions
Coinbase One members may also earn up to 3.5% APY in USDC rewards.
The lending feature is said to be the first step in Coinbase’s efforts to expand following the launch of this offering in the US in January 2025. Coinbase reports that interest in the US has been “substantial” with originations topping $2 billion in USDC as of April 14th. Other countries are in the queue to provide a similar lending feature.
Shares of Coinbase have caught a bid in recent days, largely due to the rise in Bitcoin’s price, but adding services like crypto lending helps. Of note, Coinbase will offer rewards to borrowers. Coinbase offers USDC holders rewards to some users outside the US. The concept of rewards for stablecoin holders is being hotly debated in the US, as banks fear deposit flight if stablecoin holders earn something on their holdings. Of course, banks could choose to compete, but legacy institutions tend to avoid that fact.