Coinbase accepts tokenized gold (PAXG) as collateral to borrow USDC

Coinbase Borrow supports PAXG, Paxos’ tokenized gold, as its first non-crypto collateral, alongside BTC, ETH, XRP and SOL. The loans work through a new Morpho USDC/PAXG market on Base.

Coinbase’s integration with Morpho has accumulated around $3.4 billion in collateral and more than $1.7 billion in active loans. According to the announcement, there is about $5 billion of tokenized gold onchain. It does not disclose loan-to-value ratios or rates.

Gold-backed loans on crypto-backed lending infrastructure

Coinbase users can now borrow stablecoins against tokenized gold issued by Paxos without leaving the Coinbase app.

Coinbase Borrow already allows users to obtain loans using a variety of cryptocurrencies as collateral: BTC, ETH, XRP, SOL and more. To date, the integration has approximately $3.4 billion in collateral on Morpho, with more than $1.7 billion in active loans , making it one of the largest crypto-backed lending integrations between a consumer platform and an open credit network.

With tokenized gold, Coinbase expands this proven infrastructure by adding a new USDC|PAXG market on Morpho on Base, without rebuilding the infrastructure from scratch or creating a new lending market.

Morpho is one of the largest sources of onchain USDC liquidity, allowing Coinbase users to access competitive USDC borrowing rates against gold.

Tokenization is just the first step.

Gold represents an asset class of roughly $30 trillion, of which only about $5 billion is tokenized onchain. An even smaller fraction is used as a productive onchain asset, as collateral in current loans. As with loans backed by tokenized equities, gold-backed loans are a still-developing market for onchain credit.

We have long believed that tokenization is just the first step for asset issuers. When tokenized assets can be used as collateral to unlock stablecoin liquidity and become an integral part of onchain finance, they will truly differentiate themselves from their offchain counterparts and demand for them will grow.

Gold is the first non-crypto asset on Coinbase Borrow. The same path is open to any tokenized asset and to platforms building on Morpho.