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Major Platform Expands Crypto Credit with New ETH-Backed Loans
Source: CryptoNewsNet Original Title: Coinbase expands crypto credit with new ETH-backed loans Original Link: A major compliance platform has launched Ethereum-backed loans for eligible U.S. customers, allowing users to borrow up to $1 million in USDC without selling their ETH holdings.
Key Highlights
Service Details
The service represents one of the platform’s largest decentralized finance-integrated offerings to date. The launch follows the platform’s recent increase of its Bitcoin-backed loan limit to $5 million.
The loan program operates through Morpho, a lending protocol on Base, the platform’s Layer 2 network. The platform serves as the access point while loans are executed through Morpho’s smart contracts, enabling users to access decentralized finance liquidity through a centralized platform interface.
Users deposit ETH as collateral and receive USDC without triggering a taxable event, differentiating the service from direct cryptocurrency sales.
Risk Parameters and Expansion
Borrowers must maintain their loan-to-value ratio below 86%, at which point positions face automatic liquidation due to cryptocurrency price volatility. The platform stated the feature will expand to include additional assets, including staked-ETH derivatives.
Market Context
Onchain lending across the Base ecosystem has surpassed $1.25 billion, driven by increased activity in institutional and retail credit markets. The lending protocol has experienced notable inflows as traders and long-term holders utilize collateralized borrowing to access liquidity while maintaining cryptocurrency exposure.
The expansion positions the platform within the growing cryptocurrency-native credit market as it increases its decentralized finance integration and borrowing options for major cryptocurrencies.