Coinbase ups Bitcoin-backed USDC loan limit to $1 million after seeing $130 million in originations this year

The cryptocurrency exchange Coinbase increased the borrow limit of its bitcoin-backed USDC loans to $1 million, according to a release shared with The Block. By increasing the loan limit, Coinbase aims to accelerate adoption of its onchain loan program, which launched earlier this year and has already grown to see more than $130 million in total onchain loan originations.

Coinbase initially launched bitcoin-backed USDC loans on Jan. 16 through collaboration with the decentralized lending protocol Morpho, The Block previously reported. The exchange pitched these onchain loans, initially capped at $100,000, as a way to provide traditional finance services using blockchain-based tools and a way for users to do more with their bitcoin. 

Since launch, over 4,211 wallets have originated loans backed by around $227 million in onchain collateral, a Dune Analytics dashboard shows. Bitcoin-backed loans on Coinbase are available to all users in the United States except those in the state of New York. 

The loan program lets users borrow USDC against their bitcoin without having to sell their asset. When someone takes out a bitcoin-backed loan on Coinbase, it's converted into a Coinbase Wrapped BTC, or cbBTC, and held as collateral on a Morpho smart contract, according to the Coinbase site . The loans can see rates as low as 5% .

The decentralized lending protocol Morpho supports the blockchain networks Ethereum and Base . The platform maintains over $2.76 billion in total value locked, according to the data tracking platform DeFiLlama. 

Coinbase is one of the world's most popular cryptocurrency exchanges. The firm brought in $102.1 billion, or around 7%, of the $1.45 trillion total spot crypto trading volume among centralized exchanges in March, The Block's Data Dashboard shows. 

Bitcoin is trading at around $93,900 at press time, with the asset drawing in $28.7 billion in trading volume in the past 24 hours, The Block's bitcoin price page .