Coinbase customers can now borrow USDC against PAX Gold (PAXG) through the Morpho protocol on Base. The service accepts a non-crypto asset as collateral for the first time, but loan-health pricing for PAXG updates only during gold-market hours.
Coinbase said on Nov. 6 that customers can borrow USDC against PAXG through the Morpho lending protocol on Base. Holders of tokenized gold get access to liquidity without selling their tokens.
The move extends a borrowing service that began with bitcoin collateral in January 2025. Crypto Briefing reports that it is the first time Coinbase Borrow has accepted collateral that is not a crypto asset.
How the PAXG loans work
Borrowers pledge the token as collateral rather than selling their gold exposure. Coinbase supplies the interface, and the collateral is locked on Morpho until the loan, fees and accrued interest are repaid.
Access is restricted to eligible customers. Coinbase's help center lists verified customers in the U.S., excluding New York, and Canada, with limited access in the U.K.
Rates are variable. Crypto Briefing says there is no fixed repayment schedule, and the Morpho Blue market sets rates rather than Coinbase.
Gold-market hours shape loan risk
Morpho's market registry returns four PAXG-collateral markets on Base that lend USDC. All four have a 77% liquidation loan-to-value threshold, which is a liquidation boundary, not a recommended borrowing level.
Pricing timing matters for borrowers. Coinbase's loan-health documentation says PAXG prices update during gold-market hours, approximately 23 hours a day on weekdays, but not while those markets are closed, including weekends. Loan health therefore may not immediately reflect changes in gold prices.
Interest can also push a loan toward liquidation even without a fall in collateral value. Coinbase says interest accrues continuously, and borrowers can lower their loan-to-value ratio by repaying debt or adding collateral.
Sources: The Defiant, Crypto Briefing
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