Nasdaq-listed trading platform Coinbase now enables clients to secure loans of the dollar-pegged stablecoin USDC using their bitcoin reserves, with complete predictability regarding interest expenses.
The exchange has introduced fixed-rate, bitcoin-secured USDC loans, featuring interest percentages and settlement dates locked in at the inception of the loan, providing an alternative to Coinbase’s existing floating-rate borrowing options.
According to a Tuesday publication, this shift pushes onchain financing past the traditional variable-rate structure, granting participants heightened predictability concerning their borrowing expenses and loan periods.
This fixed-rate alternative operates via Morpho Midnight, a decentralized, noncustodial borrowing and lending infrastructure for fixed-rate and fixed-term digital asset loans that debuted in July of this year, while clearing operations via Base, Coinbase’s Ethereum layer 2 scaling platform.
This development signifies a notable departure from how borrowing historically functioned on Coinbase. Current credit facilities utilize the Morpho Blue framework, where interest shifts dynamically based on supply and demand metrics, occasionally surging when borrowing interest climbs. The newly introduced fixed-rate alternative functions alongside this variable framework, which maintains upwards of $1.4 billion in active borrowings backed by nearly $3 billion in assets.
Although fixed-rate, bitcoin-backed credit solutions are not unprecedented—with platforms like Ledn and SATL Lending having provided them for years—Coinbase’s implementation is unique because it executes entirely onchain, leveraging a decentralized finance application directly inside a mainstream consumer interface.
Paul Frambot, co-founder and chief executive officer of Morpho, noted that collaborative products between Morpho and Coinbase have achieved immense success, with current efforts shifting toward scaling those deployments.
As he communicated on X, teams are actively expanding upon that foundation to scale new loan formats and use cases, driving onchain credit closer to the scale and variety found in traditional global credit markets.
Data from the Bitcoin Digital Credit Report, produced by Apyx and BitcoinTreasuries.net, estimates the current bitcoin-backed credit sector at roughly $16 billion. Projections suggest this figure could expand to $130 billion by 2030 alongside the scaling of preferred equity structures.
Holders maintain a clear appetite for putting their BTC assets to work. Protocol Theory surveyed 1,244 digital asset holders throughout the United States and Australia from February through March 2026, uncovering that 88% of participants would contemplate utilizing a crypto-backed loan or credit facility.
Originally published at https://www.coindesk.com/markets/2026/09/23/coinbase-users-can-now-borrow-usdc-against-bitcoin-at-a-fixed-rate.
