Coinbase Introduces Fixed-Rate Bitcoin Loans via Morpho Midnight
Coinbase has added fixed-rate Bitcoin-backed loans through Morpho Midnight, allowing users to borrow USDC against BTC collateral. The interest rate and repayment date are set when the loan is taken out.
The new option sits alongside Coinbase's existing variable-rate loans, which use Morpho Blue. This appeals to Bitcoin holders who want USDC without selling, as they know their borrowing cost upfront and have a definite end to their loan.
Coinbase manages the app experience, while Morpho provides the lending protocol, and transactions settle on Base, Coinbase's Ethereum layer-2 network. Borrowers must repay before the maturity date; if a loan goes unpaid, the lender has a claim on the collateral posted by the borrower.
Morpho launched Midnight on Base in July to bring fixed rates and defined loan terms to onchain lending. Coinbase is the first major consumer platform to offer loans through Midnight at scale. The new feature has around $30 million in deposits as it rolls out, according to Morpho.
By comparison, Coinbase's existing Morpho Blue variable-rate loans have grown to more than $1.4 billion outstanding, backed by roughly $3 billion in collateral.