News View Non-AMP

Coinbase Relaunches Bitcoin Loans: Can They Succeed?

Published by
Vijay Gir

Coinbase is giving Bitcoin-backed loans another shot. Their last attempt didn’t go as planned. It ended in 2023, partly due to low demand and regulatory hurdles. But they’ve returned with a fresh approach, powered by DeFi technology. This time, they’re betting it’ll be safer, smoother, and more appealing to everyday users. But will it succeed this time?

Why Coinbase Failed Earlier

Coinbase once allowed users to borrow up to $1 million by using 30% of their Bitcoin as collateral. It sounded great, but the program didn’t last long. By July 2023 coinbase had to shut it down.

The exchange blamed a lack of demand, but there was a bigger issue. The SEC had filed a complaint accusing the company of operating without proper registrations. This added legal pressure might’ve pushed them to end the program earlier than planned. The plan is back, but this time, they’ve learned from those mistakes.

A New Safer Model

With the relaunch of loan service, Coinbase isn’t the one lending you money directly. Instead, they’ve teamed up with Morpho, a decentralized finance (DeFi) protocol handling $3.7 billion in deposits. Morpho’s system lets Coinbase keep control of the program while avoiding the unpredictable nature of DAOs (decentralized autonomous organizations).

This setup combines Coinbase’s easy-to-use platform with the advanced tech of DeFi. It’s a clever way to make borrowing against Bitcoin less intimidating for users. According to Morpho’s CEO, Paul Frambot, this partnership gives Coinbase more flexibility and security than most DeFi systems.

But it’s not for everyone just yet. Residents of New York are excluded for now, although Coinbase plans to expand its reach soon.

Can It Win Back Trust?

Crypto lending hasn’t had the best track record. The 2022 crypto crash wiped out billions when companies like Celsius and BlockFi went bankrupt. Those failures left people wary of lending platforms.

Coinbase is clearly aiming to do things differently this time. By blending traditional finance simplicity with the cutting-edge tech of DeFi, they’re hoping to win back trust. Will users give it a chance? Only time will tell.

Vijay Gir

Vijay Gir is a Certified Blockchain Expert with over 8 years of experience in the blockchain industry. He has a deep passion for sharing his knowledge of blockchain, cryptocurrency, and web3 technologies. For the past 7 years, Vijay has been dedicated to writing about these transformative topics, helping others stay informed and understand the evolving landscape of decentralized technologies.

Recent Posts

XRP Price Prediction As Judge Torres Blocks Ripple-SEC Motion

There’s fresh tension in the Ripple vs SEC case after Judge Analisa Torres rejected a…

June 27, 2025

Ripple Lawsuit Update: Judge Denies Motion, New Timeline Revealed

There’s a big update in the Ripple vs SEC case. Judge Analisa Torres has officially…

June 27, 2025

Bitwise Amends S-1 Filings for Spot Dogecoin ETF and Aptos ETFs: Approvals on Track?

Bitwise Asset Management filed amended S-1 registration statements with the United States Securities and Exchange…

June 27, 2025

Top Reasons Why Bitcoin Price May Retest $92k First Before Reaching $120k in the Midterm

Bitcoin (BTC) price has experienced heightened resistance around $108k in the past few days amid…

June 27, 2025

XRP Price Prediction, Next 100x meme coin : How Can XRP Push Past $5 Before the End of 2025?

XRP’s Setup Signals Breakout Potential XRP is showing strong recovery signs as analysts project a…

June 26, 2025

Kaanch Network Just Became the Most Talked-About Layer 1 Token on Crypto X

Kaanch is fast becoming one of the outstanding tokens in Crypto X which is attracting…

June 26, 2025