Coinbase has launched crypto-backed USDC loans in the UK. Users can borrow up to $5 million in the stablecoin. They put up Bitcoin, Ether, or Coinbase Wrapped Staked Ether as collateral.
The loans run on the Morpho protocol. It’s built on Coinbase’s Base network. According to the Coinbase official blog, this marks the exchange’s latest push into onchain financial services.
The UK expansion follows a similar U.S. rollout in November 2025. American customers can borrow up to $1 million against Ether across most states.
Interest rates are variable. Morpho determines them algorithmically based on Base market conditions. Translation: borrowing costs can fluctuate.
Borrowers don’t have a fixed repayment schedule. But there’s a catch. Your loan-to-value ratio can breach specified thresholds. Cross that line and you face liquidation. Standard DeFi lending mechanics.
The loan product builds on Coinbase’s growing UK presence. The company gained FCA registration as a crypto service provider in 2025. That regulatory approval opened doors. Coinbase introduced DEX trading to British customers. Savings accounts too.
The exchange is also piloting token-backed mortgage down payments. It’s partnering with Better Home & Finance. Crypto collateral meets traditional home lending.
Coinbase’s timing matters. The UK expects comprehensive crypto regulations by October 2027. The FCA’s ongoing consultation process confirmed the timeline. The forthcoming regime will cover stablecoins, trading platforms, custody services, and staking. Right now, only partial regulation exists. It focuses on financial promotions and anti-money laundering compliance.
Coinbase is establishing crypto lending infrastructure early. It could influence how UK authorities treat onchain lending. And stablecoin-based consumer finance products. The integration of Morpho’s protocol on Base shows something bigger. Major exchanges are layering retail financial products onto blockchain networks. They’re moving away from purely centralized operations.
The UK market represents strategic expansion. Regulatory clarity is emerging. Borrowing limits reach $5 million against Bitcoin collateral. The offering targets retail customers. Higher-net-worth customers too. They want liquidity without triggering taxable events from asset sales.
The FCA is moving toward comprehensive oversight. Early movers like Coinbase may shape the standards. They’ll influence how crypto-backed lending operates in one of Europe’s largest financial markets.
