According to Coinbase's September 9 announcement, the company has expanded its Morpho-powered USDC lending product to eligible Brazilian customers over the coming days. Brazilian users can now allocate USDC to Morpho through the Lending tab in the Coinbase app, accessing market-driven returns without a fixed lock-up period. The product represents Coinbase's continued expansion of its DeFi Earn service beyond its initial US launch, extending to a market where stablecoin adoption is rapidly growing. As Regional Managing Director Fabio Plein explains, this expansion reflects the company's efforts to make users' assets work harder for them, alongside staking and USDC Rewards as pathways for users to build wealth and become more connected to the Everything Exchange.
As reported by Coinbase, deposited USDC enters a vault curated by Steakhouse Financial that has undergone audit verification. The lending mechanism operates through Morpho's decentralized protocol, where borrowers supply crypto assets as collateral and pay interest to access USDC. Coinbase states that customers can withdraw their USDC and accrued rewards at any time, though onchain lending market access depends on available liquidity. Returns fluctuate with supply and demand on Morpho rather than maintaining guaranteed levels, with rates potentially increasing when USDC loan demand rises relative to available supply. Notably, this onchain lending path is separate from Coinbase's standard USDC Rewards program, creating a two-sided market where lenders supply liquidity that borrowers use against crypto collateral.
According to Coinbase, the product has accumulated nearly $500 million in total supply since its initial US launch in September 2025. The company reports that rates have recently reached up to 7.4% APY, though these figures may differ from current returns as borrowers enter and exit Morpho markets. Coinbase One members may receive additional rate increases where available, though the company has not specified Brazilian customer rates or whether the boost applies to all eligible accounts. The product has become one of the fastest-growing ways customers put USDC to work, with Coinbase's Earn product seeing massive adoption in the US market.
As reported by Coinbase, the Brazil expansion occurs amid Brazilian authorities implementing independent audit requirements for virtual asset service providers in June 2025. These requirements cover anti-money laundering measures, customer asset segregation, and internal risk controls, with auditors registered with Brazil's securities regulator. According to Chainalysis estimates, Brazil's crypto transaction volume reached approximately $318 billion across 2024 and 2025, with stablecoins accounting for about 90% of reported crypto flows. The central bank has also restricted virtual asset use within supervised electronic foreign-exchange channels under Resolution BCB No. 561.
According to Regional Managing Director Fabio Plein, the Brazil launch aligns with Coinbase's Everything Exchange strategy to add financial products to a unified platform. The lending option complements existing USDC rewards programs and staking services, allowing users to earn from their stablecoin holdings through different mechanisms. Coinbase previously expanded its in-app lending menu in June by adding an Ethena-powered USDC vault, though the Brazilian launch focuses on the existing Morpho-powered DeFi Earn service rather than the Ethena-linked option. As CoinGape reports, this expansion is part of a broader trend where companies like Visa are pushing onchain lending deeper into everyday payments, combining settlement data with blockchain credit infrastructure to enable stablecoin-linked card issuers and fintechs to tap working capital as they scale.
