Eight months after launching the product in January 2025, Coinbase has surpassed $1 billion in Bitcoin-backed loan origination on the chain, with CEO Brian Armstrong setting up a lifetime of $100 billion original origination.
The implied run rate for the first eight months is around $125 million per month, structuring the pace needed to reach new targets.
The loan will post Bitcoin on the chain via Coinbase-covered Bitcoin, CBBTC, and then routed to the base’s Morpho market. Usage rates are set to variable interest rates per block, and USDC is distributed to the borrower’s Coinbase account.
If the loan-value ratio reaches 86%, there is no fixed schedule for repayments, and Coinbase lists a 4.38% liquidation penalty in its customer material, then a liquidation will occur.
According to Coinbase documentation, borrowers must always maintain excessive sub-exchanges, and for now there is US availability to rule out New York.
On each Coinbase, the CBBTC is 1:1 supported by Bitcoin under detention, with public proofs and standard addresses published.
The scale of the backend is important as origination capacity depends on dollar liquidity and throughput. Total deposits rose to billions of teenagers over the summer. Morpho’s post shows collateral connected to Coinbase, which passed $1 billion in aggressive loans of hundreds of millions of people in the middle of the year.
According to Defilama, daily trading and active addresses remain promoted on double-digit bridged TVL. It supports reliable liquidation execution and faster recycling of collateral to fresh outbound.
The macro credit context has been favored by the asset support structure. Decentralized loans reached $264.7 billion in the second quarter of 2025, up 42% quarterly, but Defi, CEFI and tokenized credits have risen further. Outside of Crypto, private credit managers continue to add asset-based financial capabilities.
KKR closed a $6.5 billion salary increase this year for asset-based finance, indicating wider demand for secured credit instruments that can coexist with the secured rails on the chain.
Forward Mathematics sets expectations for Coinbase’s $100 billion goal.
If Originations averages $125 million per month from the initial period, the target requires compound interest rather than linear expansion. According to cryptographic calculations, if it reaches $100 billion by 2030, it will take about 7.7% monthly increase from today’s base, and about 9.6% per month to arrive in 2029.
To hit a milestone by 2027, it will take approximately 21.2% per month. This depends on the larger dollar supply and greater tickets per loan at the base’s morpho market as Coinbase moves to the luxury market.
The number of lifetime loans required will materially fall as the average ticket size increases, linking the path to both book collateral and USDC side capacity.
| Target year | The month to the target | Necessary M/M growth | The implicit cagr |
|---|---|---|---|
| 2027 | ~twenty four | ~21.2% | ~900% |
| 2029 | ~50 | ~9.6% | ~212% |
| 2030 | ~62 | ~7.7% | ~144% |
Risk is concentrated in collateral price pathways and liquidity at the moment of use. The 86% LTV liquidation rule means a clear drawdown threshold when starting leverage increases.
The cohort entering at a conservative ratio has a larger buffer, but the higher the LTV borrower, the closer the band faces during rapid price movements and the spike in gas prices.
According to Coinbase documentation, liquidation is automatically applied to the chain, with penalties applied at runtime.
| Start LTV | BTC drawdown to reach 86% LTV |
|---|---|
| 30% | ~65% |
| 35% | ~59% |
| 40% | ~53.5% |
| 50% | ~41.9% |
The rate sensitivity is the second lever.
The Morpho market sets borrowing costs at the block level based on utilization, so sudden increases in USDC demand can increase effective rates.
According to Morpho, changes in governance and incentives have been used to expand USDC supply and rebalancing use. This is a practical prerequisite for increasing single loan limits towards the level that high-net users are looking for.
The distribution model aligns traditional account primitives with unauthorized payments. Borrowers will start and manage positions with familiar security and reporting, but actual lending, collateral and liquidation will take place in the base’s open market.
For each morpho, this front-end and backend split supports partner-driven influx without users interacting with new wallets or navigating complex pool selections.
The large market background has led to lessons from 2022, when maturity inconsistencies and collateral concentration highlighted central lenders. Here, differences in structure apply here. This includes on-chain collateral processing and program liquidation, but dollar liquidity during stress events remains a central variable.
The use of the base activity, bridged TVL, and Morpho market provides a real-time context of origin capacity and liquidation execution costs in both mild and stressful conditions.
The mechanics supporting that shift are live today, and the next phase shows how fast the dollar liquidity and borrower mix can scale in the chain.
It is mentioned in this article
(tagstoTranslate)Bitcoin
