Morpho Opens Borrowing Against Coinbase's Tokenized Stocks

Lending and borrowing against Coinbase's tokenized stocks is live on Base, Morpho said in a post on X at 5:58 a.m. ET Friday. Holders can pledge the tokens and draw USDC at variable or fixed rates.

The markets make Coinbase's stock tokens collateral. Coinbase began issuing them in August for users outside the United States, who hold them in self-custodial wallets rather than a brokerage account. Pledging them on Morpho lets a holder raise dollars without selling the position.

Borrowers have pledged $104,401 of stock tokens and drawn $54,652 against them, with $60,265 supplied across five markets, Morpho's application programming interface, or API, showed at 9:48 a.m. ET. Steakhouse Financial curates all five, and its two Steakhouse High Yield USDC vaults supply 98.9% of the dollars in the largest of them.

Five Of Ten Tickers

Markets exist for Apple (AAPLc), Alphabet (GOOGLc), Nvidia (NVDAc), Meta Platforms (METAc) and SpaceX (SPCXc). Base's stocks page lists ten Coinbase tokens, adding Amazon, Microsoft, Strategy, SanDisk and Tesla. Those five have no Morpho market.

The Apple, Nvidia, Meta and SpaceX markets carry a liquidation loan-to-value, or LLTV, of 62.5%. The Alphabet market is set at 77%.

All five were deployed on Sept. 7. Borrowing stayed under $600 until Sept. 16, when it rose from $503 to $42,105 in about two hours, Morpho's historical data shows. It has grown to $54,652 since.

One Curator Sets Terms

Steakhouse Financial's Steakhouse High Yield USDC vault holds $29.9 million and pays 5.18% net. It and its earlier version supply $24,540 of the $24,805 lent into the Apple market. A third vault, Chipworks USDC, supplies $262, and two wallets supply less than $3 between them.

Stock-backed markets and their parameters and compliance controls are deployed and set by curators, Morpho said in a reply to its own post, and the markets are "not available to US persons or persons in other restricted jurisdictions."

The market contracts carry no permissioning of their own. The enter gate and liquidator gate on each fixed-rate market are set to the zero address, Morpho's API shows. The restriction sits with the tokens, which Coinbase issues through Coinbase Onchain SPV Ltd under Abu Dhabi Global Market prospectuses and offers only outside the U.S.

The Fixed Side Is Empty

Morpho's fixed-rate layer, Midnight, has 19 USDC markets against each of the five tokens, 95 in all. Maturities run daily through Sept. 30, then Oct. 30, Nov. 27, Dec. 25 and March 26, 2027, alongside one open-ended market per token. Every one shows zero units outstanding.

All the borrowing so far is in the variable-rate markets. Morpho launched Midnight on Base in July and extended it to Ethereum this month.

Chainlink Sets The Price

Each market reads a Chainlink feed through Morpho's Chainlink V2 oracle adapter. The Apple feed printed $335.49 at 1:42 p.m. UTC Friday, against a DefiLlama price of $337.52 for the token.

A market at 62.5% LLTV liquidates at a 12.67% penalty. No liquidation has been executed in the Apple market since it was deployed. The largest borrower there holds 113.46 AAPLc against a 20,360 USDC loan, a health factor of 1.17.

Rates Run Hot

The Apple, Alphabet and Nvidia markets sit at 90% utilization, the target in their interest rate model. Borrowers pay 5.62% and lenders earn 5.06%. The Meta market is at 97%, past the target, where the curve steepens: borrowers pay 17.52% and lenders earn 16.98%.

A Small Collateral Pool

The five tokens have about $11.4 million outstanding on Base, based on their contract total supply and Morpho's price feeds. The $104,401 pledged on Morpho is under 1% of that.

Morpho holds $4.03 billion in deposits on Base and $10.42 billion across chains, DefiLlama shows. Base's stocks page also lists Aave and Euler as places to borrow against the tokens.

MORPHO trades at $2.40, up 11% over 24 hours, with a market capitalization of $1.68 billion, CoinGecko data shows. Bitcoin rose 4.9% and ether 4.3% over the same period.

Morpho published no blog post with the announcement. Coinbase and Base have not posted about the markets.