19.09.2025 02:36
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**Coinbase Unveils USDC Lending Program: 10.8% Returns Spark Market Optimism**
Fueled by the evolving landscape of decentralized finance (DeFi), Coinbase has recently introduced a novel lending feature allowing users to generate elevated returns on USD Coin (USDC). This new initiative, designed to be user-friendly, offers impressive annualized yields potentially reaching up to 10.8% according to company statements. This strategic expansion represents Coinbase’s latest endeavor into the DeFi sphere, a move mirroring the growing prevalence of stablecoins among both individual and institutional investors as reported by various internet resources.
The mechanics of this innovative lending option involve a partnership with Morpho, a prominent DeFi protocol. User-deposited USDC is channeled into specialized vaults which are expertly managed by the advisory firm, Steakhouse Financial. This entire process is facilitated on Base, Coinbase’s proprietary Layer 2 blockchain solution. Furthermore, Morpho’s significant presence in the DeFi ecosystem is highlighted by its current management of over $8 billion in assets, as indicated by information from DeFiLlama. This underscores its prominent role as a leading DeFi lending platform.
This program represents a significant transition. It departs from the platform's prior USDC rewards structure, which provided lower returns in the range of 4.1%-4.5%. Now, users can take advantage of Morpho-powered on-chain lending, generating yields of up to 10.8%. Funds can be withdrawn at any moment, assuming liquidity remains available, and users begin accruing yields immediately. Through the direct integration of these lending tools within their mobile application, the exchange is actively working to bridge the existing gap between the mainstream finance users and the complex on-chain protocols.
Distinguishing itself from the previous USDC Rewards program, which drew funds directly from Coinbase's internal budget and wasn't directly linked to customer asset lending, this new feature strategically links deposits to DeFi protocols. Initially, access to this on-chain service will be limited to a select group of users. However, Coinbase is planning a comprehensive expansion in the upcoming weeks, with rollouts slated across the United States (excluding New York), Bermuda, and several crucial Asian and Middle Eastern markets, including Hong Kong, the United Arab Emirates, New Zealand, the Philippines, Taiwan, and South Korea.
Market analysts suggest that Coinbase’s foray into on-chain lending has the potential to catalyze widespread adoption by retail investors, who have until now shown some hesitancy toward experimenting with decentralized applications. By integrating DeFi-based yield strategies within a familiar and regulated environment, the company may effectively normalize DeFi for a wider audience.
