Coinbase has surpassed $1 billion in Bitcoin-backed loan originations through its on-chain lending program on Base. The milestone shows rising demand for Bitcoin as collateral in decentralized finance.
Morpho, a decentralized finance (DeFi) protocol, powers the service since its launch in January. This development lets Coinbase users borrow USDC against their Bitcoin and repay flexibly without selling their holdings.
“Next goal: $100B in onchain borrow originations,” said CEO Brian Armstrong while celebrating the growth on X, adding, “These adoption charts are what every product manager wants to see: hockey stick growth. The onchain economy is thriving.”
Expanding borrowing limits
Originally, the program allowed borrowing up to $100,000 in USDC. By April, after $130 million in activity, Coinbase raised the ceiling to $1 million. Now, Coinbase says customers will soon be able to access as much as $5 million per loan.
“The onchain economy is growing, so we’re growing with it. Loan limits are increasing — get up to $5M in USDC against your Bitcoin,” Coinbase said in a statement.
How Coinbase loans work
When users borrow, Coinbase converts their Bitcoin into Coinbase-wrapped bitcoin (cbBTC) at no fee, then transfers it to Morpho. The DeFi protocol issues USDC loans directly into customer accounts on Coinbase. Borrowers must maintain a collateral ratio of at least 133%. Liquidations trigger if balances climb to 86% of collateral value.
Additionally, interest rates adjust automatically with every block on Base. Users face no minimum payments or fixed deadlines, provided their loan-to-value remains healthy. Although Bitcoin is the only collateral now, Coinbase plans to expand support to more assets.
Coinbase’s growth shows that Bitcoin is moving beyond just being held. With larger loans available, more people and institutions will likely tap on-chain credit as an easier way to access cash.