Coinbase Relaunches Bitcoin-Backed Loans Through Ethereum Network Base

Coinbase is leaving Bitcoinloans backed by the world’s oldest cryptocurrency as it soars to new heights, nearly two years after it suspended its debt service.

Customers can borrow up to $100,000 USDC stablecoin instantly through the firm’s centralized exchange platform, Coinbase said In a statement Thursday. Lending services are powered by Morpho, a popular lending protocol Basethe Ethereum A layer-2 network incubated by Coinbase.

Loans are secured by collateral of 133% of their value, said a representative of Coinbase Decryption. Interest rates are variable and are automatically calculated by Morpho based on changing market conditions. As long as customers maintain a healthy loan-to-value ratio, there are no limits or deadlines on payment schedules.

Coinbase debuted Bitcoin-backed loans in November 2021, but it stopped producing them May 2023 Amid Crypto Market Decline and Weeks After Trading Firm Knows may face enforcement action by the SEC. It also arrived at the same time as Coinbase intensified the current legal battle against federal regulators.

At the time, Coinbase attributed the decision to end the lending service to changes in customer demand. The reintroduction of bitcoin-based loans comes shortly after the digital currency hit an all-time high. Above $108,000.

The token’s price remains high on a wave of news after Donald Trump’s election victory: a number of lawmakers are swimming Bitcoin backup offers at the state level, and earlier this week there were reports that the SEC might Stop actions against digital asset companies and making other crypto-friendly changes ahead of the incoming administration of President-elect Trump.

Bitcoin is trading at $100,500 at the time of writing, according to CoinGecko data shows.

Bitcoin-backed loans will be available to merchants in the US, excluding New York, according to Coinbase. In addition to launching other crypto-backed lending options, the trading platform plans to expand Bitcoin-backed loans to other markets in the future.

Edited by Andrew Hayward