What to know:
Coinbase has introduced a borrowing feature that lets eligible U.S. customers (excluding New York) use cbETH, its tokenized staked ether, as collateral to borrow up to $1 million in USDC.
The loans, powered by on-chain lending protocol Morpho, are overcollateralized with variable interest rates and no fixed repayment schedule, but borrowers must keep loan-to-value ratios below 86 percent to avoid automatic liquidation.
By enabling cbETH-backed borrowing, Coinbase is expanding the utility of staked ether, allowing users to maintain ETH exposure and staking rewards while accessing liquidity amid growing competition around staked-asset lending products.