Coinbase’s lending product offers up to 10.8% returns on USDC deposits, with a temporary boost from DeFi lender Morpho. Around 6% of returns come from Morpho’s platform, with an additional 5% boosted by the protocol itself. The subsidy from Morpho is elevating the current yield of the lending product. The product has sparked intrigue in the crypto lending space, with some recalling previous high returns that ended poorly. Morpho operates on Ethereum and Coinbase’s Base network, offering markets for overcollateralized loans. A vault tied to Steakhouse on Morpho had $24 million in USDC deposits and a 5.87% yield.

Coinbase’s lending product is tied to a vault on Morpho, which is part of Coinbase’s second rollout of crypto-backed loans. Users can earn up to 4.5% APY on USDC in their accounts. Stablecoin rewards have been called a loophole by some banking groups, while others see yields as crucial for stablecoin adoption in a competitive market.

Read more at Yahoo Finance: Temporary ‘Boost’ from DeFi Lender Morpho Behind Elevated USDC Lending Rates for Coinbase Users