Coinbase’s Profitable Strategy with Bitcoin-Backed Loans
- Coinbase and Steakhouse share performance fees from user repayments on Bitcoin-backed loans.
- Users can deposit wrapped Bitcoin and Circle’s USDC into vaults on the DeFi protocol Morpho to earn yield.
- The vault curated by Steakhouse allows Coinbase users to earn a yield of up to 5.6% APY, with a performance fee of up to 25% shared between Steakhouse and Coinbase.
- Coinbase’s lending product has been accessed by over 14,200 wallets since its launch, with an average loan size of $50,000.
Coinbase is leveraging its position as a technology provider to connect users with decentralized financial products like Morpho, allowing them to utilize digital assets without selling them. This approach reflects the growing interest in DeFi solutions for financial empowerment and wealth growth.
By sharing performance fees from Bitcoin-backed loans and facilitating access to decentralized protocols, Coinbase is not only generating profits but also expanding its offerings in the crypto lending space. (Source)
