Coinbase Adds Solana as Collateral for USDC Loans

Coinbase on May 12 expanded its crypto-backed lending service by adding Solana as an eligible collateral asset, enabling eligible U.S. users to borrow up to $100,000 in USDC stablecoins against their SOL holdings without selling the cryptocurrency.

The non-custodial product, powered by the Morpho protocol on the Base network, previously supported Bitcoin and Ethereum as collateral. Solana now joins them with a maximum loan-to-value ratio of 70 percent, meaning a holder of $10,000 worth of SOL could borrow up to $7,000 in USDC. Collateral is locked in an on-chain smart contract, with no fixed repayment deadline. Interest rates start as low as 5 percent, but positions face automatic liquidation with a 4.38 percent penalty if the loan-to-value ratio exceeds safe thresholds due to price volatility. Borrowed USDC cannot be used for trading on Coinbase. The service is unavailable to New York residents due to state regulations.

Platform data shows Coinbase has originated more than $2.3 billion in loans since launching the product last year. Bitcoin accounts for $2.17 billion, Ethereum about $110 million, and smaller volumes from assets including XRP at $31.6 million, cbETH, Dogecoin,...