Coinbase will introduce USDC lending directly within its app, allowing users to earn yields as high as 10.8% through a new onchain integration with Morpho, the company said on Thursday.
The feature, which will roll out to customers in the US (excluding New York), Bermuda, and other jurisdictions over the coming weeks, enables users to lend their USDC to borrowers on Base, Coinbase’s layer-2 blockchain.
The lending system works by creating a smart contract wallet that connects to the Morpho protocol, with Steakhouse Financial managing onchain vaults that allocate liquidity across multiple markets.
This design is meant to optimize returns while preserving user access to funds, which can be withdrawn when liquidity is available. Coinbase emphasized that despite the complexity of decentralized finance (DeFi), the integration will maintain the platform’s familiar interface and security features.
USDC, a stablecoin redeemable 1:1 for U.S. dollars, already provides Coinbase users with passive rewards of 4.1% APY, or 4.5% for Coinbase One members. The lending expansion marks a push to increase earnings potential for holders of the asset, which has a circulating supply of more than $73 billion.
Subheading updated 9/18/25 at 1:02 p.m. to correct a typo in yield percentage.
This article was generated with the assistance of AI and reviewed by editor Jeffrey Albus before publication.
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Source: https://blockworks.co/news/coinbase-usdc-onchain
