Coinbase now lets eligible U.S. customers borrow USDC against Hyperliquid's HYPE token and Zcash's ZEC, the exchange said on September 29. Borrowers can take out up to $100,000 instantly, using the assets as collateral. The option is open to U.S. users outside New York.
How the loans work
The borrowing service runs through Morpho, a decentralized lending protocol, on the Base network. That means the loans aren't sitting on Coinbase's balance sheet in the traditional sense — they're executed onchain via a third-party protocol. Coinbase handles the customer-facing side and the eligibility checks, while Morpho's smart contracts manage the lending pools.
Users don't have to sell their HYPE or ZEC to get liquidity. They can post either token as collateral and receive USDC, the stablecoin pegged to the dollar, without triggering a taxable sale or giving up their position. The $100,000 cap applies per borrower, and the process is designed to be immediate — no manual underwriting, no waiting for approval.
Why HYPE and ZEC
Hyperliquid's HYPE token has become one of the more actively traded assets in the decentralized finance space over the past year, tied to a perpetual futures exchange that has drawn steady volume. Zcash, meanwhile, is one of the older privacy-focused coins still in circulation, with a dedicated holder base that has weathered multiple market cycles.
Adding them as collateral gives holders of both tokens a way to access cash without exiting. For Coinbase, it's another step in expanding what customers can do with assets beyond the handful of large-cap coins that typically dominate lending markets.
What it doesn't include
New York residents are excluded from this offering. That's a familiar pattern for crypto products in the U.S., where state-level regulations often force exchanges to roll out features on a state-by-state basis. Coinbase hasn't said whether it plans to seek approval in New York or expand to other jurisdictions.
The service also doesn't cover every asset on the platform. HYPE and ZEC are the two additions announced; the full list of eligible collateral likely includes other tokens already supported for similar loans, but Coinbase's announcement focused on the new pair.
The Morpho and Base connection
Morpho has become a common backend for exchanges looking to offer onchain lending without building the infrastructure themselves. Base, the layer-2 network incubated by Coinbase, provides the settlement layer. Putting the lending service on Base keeps transactions cheap and fast, which matters when borrowers are posting collateral and drawing loans in real time.
The arrangement also means the risk sits with Morpho's lending pools, not with Coinbase's core exchange operations. If collateral values drop sharply, liquidation logic kicks in according to the protocol's rules. Coinbase hasn't published the specific loan-to-value ratios or liquidation thresholds for HYPE and ZEC, so borrowers will need to check the terms inside the app before committing collateral.
Eligible users outside New York can access the feature now. There's no word yet on when — or if — it will reach New York customers, and Coinbase hasn't given a timeline for adding more collateral assets. For now, the offer stands at two tokens and a $100,000 ceiling.
