Coinbase begins offering bitcoin-backed loans

The U.S. cryptocurrency exchange Coinbase has launched a service for providing Bitcoin-backed loans through the decentralized platform Morpho. This was reported by the company's press service.

According to official information, clients will be able to obtain loans of up to $100,000 in USDC stablecoins, using their Bitcoins on Coinbase as collateral. This option will help expand the financial opportunities for the exchange's users in the field of decentralized finance (DeFi).

Loans will be issued according to the following scheme: a Coinbase client selects an on-chain loan, and the collateral in BTC is converted on a 1:1 basis into wrapped Bitcoin from the exchange (cbBTC) with no fees. After that, cbBTC goes to the Morpho protocol for processing, after which the client receives a loan in USDC in their Coinbase account. The interest rates on the loans are variable and will be automatically determined by the Morpho platform based on market conditions. The repayment schedule for the loan is flexible, with no minimum payments or clearly defined deadlines.

This service is currently available to clients in the U.S., excluding New York, but in the future, the crypto exchange plans to expand to other markets.