Coinbase Adds HYPE and ZEC as Collateral for Loans of Up to $100,000

Coinbase added Hyperliquid’s $HYPE and Zcash’s $ZEC as collateral for $USDC loans, saying on Sept. 29 that customers can now “instantly borrow up to $100k” against the assets. The announcement makes the borrowing option available to eligible U.S. users outside New York through Morpho on Base.

The addition lets holders access $USDC without first selling those tokens, but puts their collateral at risk of automatic liquidation. Coinbase supplies the interface: its product page says collateral moves onchain to Morpho and the borrowed $USDC arrives in the customer’s Coinbase account. Its integration terms specify that Coinbase is not the lender.

The expansion builds on Coinbase’s January 2025 rollout of bitcoin-backed Morpho loans. That offering initially accepted only bitcoin. Coinbase’s current eligibility documentation lists $HYPE and $ZEC alongside BTC, ETH, cbETH, XRP, DOGE, ADA, LTC, SOL and JitoSOL, while noting that collateral options can vary by region and loan type.

Borrowing Costs and Liquidation Risk

For variable-rate loans, interest changes with supply and demand in the lending market. Those loans have no repayment deadline or minimum payments, but interest continues to accrue. Coinbase also offers fixed-rate loans with a maturity date; Morpho’s Sept. 22 announcement described that product as starting with bitcoin collateral.

Coinbase’s fee schedule lists a processing charge of 2% on the first $250,000 borrowed and 1% on amounts above that. The charge is added to principal and accrues interest. A separate platform fee may apply, and Coinbase says fixed-rate processing fees may differ.

The key risk measure is loan-to-value, or outstanding debt including interest divided by the market value of collateral. A falling token price or accumulating interest increases that ratio. Coinbase’s loan-health documentation says liquidation thresholds vary by collateral asset and are displayed in the loan overview. Borrowing limits and rates are shown in the app before borrowing.

The integration already supports a sizable lending business. Morpho said on Sept. 22 that Coinbase’s variable-rate product had more than $1.4 billion in active loans backed by approximately $3 billion of collateral. Those figures describe the existing loan book, not borrowing against the newly added tokens.

Borrowers can reduce their loan-to-value ratio by repaying debt or adding collateral. Coinbase warns that it cannot prevent Morpho from liquidating collateral once the applicable threshold is reached.