Coinbase Launches USDC On-Chain Lending via Morpho with Up to 10.8% APY

Published: 2025-09-18 18:35:57 |

Coinbase has rolled out a new USDC on-chain lending service on its Base Layer-2 network through integration with the decentralized Morpho protocol and Steakhouse Financial–managed vaults. The product offers up to 10.8% APY on USDC lending, outpacing its existing 4.1% USDC Rewards, and allows anytime withdrawals with no lockup period. As Coinbase’s first complete on-chain lending and borrowing ecosystem, it creates a flywheel between USDC deposits and crypto-backed loans, including bitcoin-collateralized loans of up to $1 million. Initially available in the US (excluding New York), Bermuda and select international markets, the service underscores Coinbase’s strategy to simplify DeFi access and drive deeper on-chain liquidity. A wider rollout is planned in the coming weeks.

Neutral

USDC is a stablecoin pegged to the US dollar, so even with increased demand from the new USDC lending service, its price remains stable. While the product may boost on-chain liquidity and protocol token MORPHO saw a surge, USDC itself is designed to maintain a 1:1 USD peg, resulting in no direct price impact.