- Ether holders on the exchange can borrow up to $1 million in USDC using ETH as collateral.
- This provides access to liquidity/cash without having to sell holdings.
- The service is available in all U.S. states except New York.
Leading exchange Coinbase has launched a new feature likely to reduce sell-side pressure amid recent turbulence in the crypto market.
The trading platform introduced Ethereum-backed loans that let users in most U.S. states access on-chain cash without relinquishing their holdings.
Notably, borrowers can use ETH assets as collateral and receive loans of up to $1,000,000 in the USDC stablecoin.
The team confirmed on X:
ETH-backed loans are here. You can borrow USDC against your Ethereum, unlocking liquidity without selling.
If you believe in somΞTHing, this one’s for you.
ETH-backed loans are here.
You can borrow USDC against your Ethereum, unlocking liquidity without selling.
Available now in the U.S. (ex. NY). pic.twitter.com/eOvJ2BWPfr
— Coinbase 🛡️ (@coinbase) November 20, 2025
This move is important for Ethereum holders who want liquidity without dumping their tokens.
Rather than selling ETH and potentially missing future price gains, Coinbase users can tap their balances while keeping holdings intact.
How do ETH-backed loans work?
The process is straightforward. Users deposit Ethereum as collateral into their Coinbase accounts to borrow USDC.
Collateral is returned once the loan is repaid.
At the same time, customers gain strong flexibility.
Individuals can borrow while maintaining their holdings, access funds almost instantly, and use USDC for a range of on-chain activities, including everyday spending and trading.
Borrowers should, however, be aware that Ethereum price movements can affect their loans.
A rapid drop in ETH value could, for example, require additional collateral to avoid liquidation.
Why it matters to you
Online access to cash often forces crypto investors to sell assets, sometimes triggering taxable events.
Coinbase addresses this with ETH-backed loans, providing liquidity access without relinquishing holdings.
The move reflects how crypto firms are expanding beyond pure trading services.
Networks and platforms are increasingly integrating lending, borrowing, and earning solutions for users as digital assets continue to gain broader adoption.
Moreover, the offering underscores Coinbase’s confidence in Ethereum as a legitimate financial instrument, comparable to traditional assets like real estate and stocks when used as collateral.
Notably, Coinbase first launched crypto-collateralized loans earlier this year, initially targeting Bitcoin.
The goal was to give users more control over their finances while delivering security, speed, and transparency.
The team emphasized:
Crypto-collateralized loans are another key step in giving our customers more control over their financial lives. Coinbase customers can now more easily and quickly access everyday financial services.
This addition signals strong demand for such services as cryptocurrencies move further into the mainstream.
ETH price outlook
The announcement arrives while Ethereum faces pronounced bearish sentiment.
It is trading around $2,837 after falling more than 3% over the past day and around 13% over the past week.
ETH needs to hold support near $2,800 to avoid a larger decline.
For a sustained recovery, Ethereum requires significant trading volume and renewed institutional interest—potentially driven by ETF activity—to lift it out of its current slump.