Coinbase has added a fixed-rate borrowing option that allows users to take out USDC loans using Bitcoin as collateral, with the interest rate and repayment date locked in when the loan is opened.
The Nasdaq-listed exchange said the new service gives borrowers more certainty than its existing variable-rate loans, where borrowing costs can change based on market supply and demand.
The fixed-term loans are powered by Morpho Midnight, a decentralized, non-custodial lending protocol launched in July. The transactions settle on Base, Coinbase’s Ethereum layer-2 network.
Previously, Coinbase’s Bitcoin-backed lending products relied on Morpho Blue, where interest rates adjust according to lending-market conditions. Rates can rise when demand for borrowing increases. That floating-rate product currently supports more than $1.4 billion in active loans secured by nearly $3 billion in collateral.
Coinbase’s new fixed-rate option operates alongside the existing variable-rate service, giving borrowers a choice between predictable costs and market-based rates.
Fixed-rate Bitcoin-backed lending is already offered by providers such as Ledn and SATL Lending. Coinbase’s product combines that model with onchain execution through a DeFi protocol and availability within a mainstream crypto application.
Morpho co-founder and CEO Paul Frambot said the partnership with Coinbase has performed strongly and is now moving toward broader product expansion.
The companies plan to introduce additional loan structures and applications as they work to scale onchain credit and broaden its use cases.
The Bitcoin-backed credit market is estimated at about $16 billion, according to the Bitcoin Digital Credit Report from Apyx and BitcoinTreasuries.net. Some forecasts estimate that the market could reach $130 billion by 2030 as preferred-equity structures gain traction.
Demand for crypto-backed credit may also be substantial. A Protocol Theory survey of 1,244 cryptocurrency holders across the U.S. and Australia, conducted in February and March 2026, found that 88% of respondents would consider using a crypto-backed loan or credit product.
The Coinbase service allows Bitcoin holders to access USDC liquidity without relying on a floating interest rate, while keeping the repayment schedule and borrowing cost defined from the start.
