Coinbase Loans Reach $2.3 Billion Amid Bank Tokenization Push

Coinbase Sees Surge in Crypto-Backed Lending

Coinbase has amassed $2.3 billion in outstanding crypto-backed loans as of October 17, 2026, a significant figure for a product introduced just in January 2025. The service allows eligible U.S. users, excluding those in New York, to leverage their Bitcoin holdings as collateral to borrow USDC, a stablecoin pegged to the U.S. dollar, without needing to sell their cryptocurrency.

These loans are facilitated through Morpho, a decentralized lending protocol, utilizing its Morpho Blue infrastructure on the Base network. By mid-September 2026, variable-rate loans alone exceeded $1.4 billion, secured by approximately $3 billion in collateral.

Coinbase expanded its lending offerings on September 22, 2026, by introducing fixed-rate loans via Morpho Midnight, providing borrowers with the option to secure their borrowing costs. Approximately one month later, the total value of crypto-backed loans reached $2.3 billion. It is important to note that the September figure exclusively accounted for variable-rate loans, making a direct comparison with the later total challenging.

Expanding Collateral Options and Mortgage Partnerships

The exchange has also broadened the range of cryptocurrencies accepted as collateral. Borrowers can now pledge XRP, DOGE, ADA, and LTC, with XRP and other assets being added in August 2026.

In a significant development also in August 2026, Coinbase partnered with Better to enable crypto-collateralized conforming mortgages under the Fannie Mae framework.

Growth in Tokenized Deposits

The concept of tokenized deposits, which represent traditional bank deposits on a blockchain for real-time settlement, is gaining traction. JPMorgan’s JPMD tokenized deposit has been operational on the Base network for institutional clients since mid-2026. Financial institutions such as Citi and BNY Mellon are also actively involved in tokenized deposit initiatives. Furthermore, several U.K. banks are preparing to launch their networks by 2027, as part of a wider industry effort involving consortium projects both domestically and internationally.