Coinbase has added Solana as eligible collateral for its crypto-backed lending service, letting U.S. users borrow up to $100,000 in USDC against their SOL holdings. The integration went live on May 12, roughly four days ago. SOL now joins Bitcoin and Ethereum as accepted collateral on the exchange's non-custodial loan product, which runs on the Morpho protocol over Base.
How the new SOL collateral works
Holders who put up SOL as collateral face a maximum loan-to-value ratio of 70%. That means a wallet with $10,000 in SOL can draw up to $7,000 in USDC. The collateral gets locked in a smart contract on-chain, and there's no repayment deadline — borrowers can keep the loan open as long as they want.
But there's a catch. If the LTV hits the liquidation threshold, the position gets auto-liquidated with a 4.38% penalty. And borrowed USDC can't be used for trading directly on Coinbase — it's meant for other purposes, like sending to a wallet or spending elsewhere.
Coinbase's cumulative crypto-backed loan originations now stand at $2.3 billion. Adding SOL as collateral gives long-term holders a way to access liquidity without selling their coins. That structurally reduces sell pressure, because holders no longer have to choose between HODLing and cashing out for expenses.
The timing isn't bad either. SOL price has been showing signs of life. At the time of reporting, it traded at $95.69 on the 4-hour chart, having broken out of a $82–$92 range earlier this month and pushed into the $98–$100 zone. Immediate support sits at $94 on any pullback, while resistance lies at $106 and $110 above the $98–$100 level.
Price context and a caveat
Still, SOL remains below its 200-day moving average — a sign the broader trend isn't fully bullish yet. The lending news may help support price, but it's not a cure-all. If SOL can reclaim and hold above $98–$100, the next leg up targets $106 and then $110. If it slips back below $94, the breakout narrative gets shaky.
The unanswered question: How much SOL will actually get locked into these loans? The product is non-custodial and requires some know-how, so adoption may be gradual. Coinbase hasn't disclosed how many borrowers have used SOL so far, but given the $2.3 billion in cumulative originations across all assets, the appetite for crypto-backed credit is clearly there.
