Coinbase Reports $2.3 Billion in Crypto-Backed Loans Outstanding

Since Coinbase launched Bitcoin-backed USDC loans in January 2025, the book has grown to $2.3 billion outstanding, according to figures the exchange reported as of Oct. 17, 2026.

That is a meaningful number for a product less than two years old. It is also small next to traditional consumer or commercial lending.

How the loans work

Eligible US users outside New York can post Bitcoin as collateral and borrow USDC, a dollar-pegged stablecoin, without selling their coins. The loans run through Morpho, a decentralized lending protocol, using its Morpho Blue infrastructure on Coinbase's Base network.

By mid-September, outstanding variable-rate loans alone had passed $1.4 billion. They were backed by approximately $3 billion in collateral.

On Sept. 22, Coinbase added fixed-rate loans through Morpho Midnight, so borrowers can lock in their costs. The September figure covered only variable-rate loans, so the jump to $2.3 billion is not a like-for-like comparison.

What Coinbase has added since summer

In August, Coinbase widened the collateral menu. XRP, DOGE, ADA and LTC are now accepted, with XRP and others added that month.

Also in August, Coinbase partnered with Better to offer crypto-collateralized conforming mortgages under Fannie Mae.

On Oct. 13, Coinbase announced an Earn & Borrow integration for Base. It lets applications built on the network offer variable-rate stablecoin yields and crypto-backed loans through third-party protocols including Morpho and Aave. Average stablecoin yield across current markets is 4.45%, excluding outside incentives.

The bank angle

A Cointelegraph post says 17 banks are now part of the lending apparatus around the $2.3 billion book. That count rests on that single post. Which banks are involved, how the loans split between retail and institutional borrowers, and the collateral mix have not been disclosed.

The broader bank movement onto blockchains is better documented. JPMorgan's JPMD tokenized deposit has been operating on Base for institutional use since mid-2026. Citi and BNY are also working on tokenized deposits. Several UK banks are targeting network launches in 2027.

A tokenized deposit is an ordinary bank deposit represented on a blockchain, which allows real-time settlement instead of waiting on legacy payment rails.

On Oct. 8, Liz Martin, head of Coinbase Institutional, said banks are launching their own digital asset services and Coinbase is serving as their infrastructure provider. The same day, Coinbase said it would provide custody of Circle's USDC balances through Coinbase Prime. It also recently said it had finished integrating Deribit, which it bought in 2025 for $2.9 billion, and would soon link its US and international derivatives markets into one liquidity pool.

Where the risk sits

The product's appeal is plain. Holders can get dollars without selling, and in many jurisdictions without triggering a taxable sale. For Coinbase, lending earns revenue from customers who are not trading.

The weak point is the collateral. SpendNode's analysis of the figures warns that a loan is only as safe as what backs it, and that a sharp drawdown forces margin calls and liquidations if borrowers cannot post more collateral. Bitcoin traded at $81,557 as of Oct. 17, down 0.6% on the day and 1.5% on the week. The Fear and Greed index sat at a neutral 49.

The addition of XRP, DOGE, ADA and LTC as collateral puts more volatile assets behind a growing share of the book. Coinbase has not published a breakdown of collateral by asset.

The lender's own shares have been weaker than its lending business. As of Oct. 8, COIN stock was down 55% over 12 months, trading at $175.11.

The bank count is still open. Until the 17 institutions are named and their roles defined, whether they are lenders, funders or service providers around Coinbase's loan program is unresolved.

The next concrete marker is 2027, when the UK banks' planned tokenized deposit networks are targeted to launch.