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- Coinbase has expanded its USDC borrowing product to the UK, allowing users to borrow against Bitcoin, Ether and cbETH.
- The service uses Morpho smart contracts on Base, with variable rates and near-instant loan disbursement into Coinbase accounts.
Coinbase is bringing its USDC borrowing product to the UK, giving local users a way to unlock liquidity from crypto holdings without selling them outright.
The exchange said the service initially supports collateral in Bitcoin, Ether and cbETH, Coinbase’s wrapped staked Ether product. Once pledged, those assets are transferred onchain into a Morpho smart contract and remain there until the loan is repaid.
Coinbase pushes deeper into crypto-backed borrowing
The mechanics are fairly simple, at least from the user side. Customers can open the Borrow section in the Coinbase app, choose which asset they want to post as collateral, and specify how much USDC they want to receive. According to Coinbase, Morpho then disburses the loan into the user’s Coinbase account within seconds.
From there, the borrowed USDC can either be converted into British pounds or transferred elsewhere. That matters because the product is not being framed as a niche DeFi feature hidden behind extra steps. Coinbase wants it to feel more like a normal financial tool built into the app itself.
For crypto users, that solves a familiar problem. Borrowing against Bitcoin or Ether allows them to access cash or stablecoin liquidity while keeping market exposure intact.
Morpho and Base sit underneath the product
The infrastructure behind the service is just as important as the front-end flow. Coinbase said the borrowing feature runs through Morpho, with interest rates determined automatically by market conditions rather than set manually by the exchange.
Those rates are variable and update constantly, changing every few seconds with each block produced on Base, Coinbase’s Layer 2 network. That means the cost of borrowing can move quickly depending on demand and available liquidity.
The rollout also shows how Coinbase is continuing to fold onchain lending infrastructure into its retail product stack without asking users to navigate DeFi directly. Morpho handles the lending logic, Base provides the settlement layer, and Coinbase keeps the customer relationship in its own app. For the company, that combination is increasingly becoming the model.
