Morpho announced that borrowing USDC against Paxos’ gold‑backed PAXG token is now live for Coinbase customers on the Base layer‑2 network. The rollout follows Paxos’ recent launch of PAXG on Base, expanding the token beyond Ethereum and Solana. According to CryptoSlate, the new market lets eligible users obtain stablecoin liquidity without selling their gold exposure, while price feeds for PAXG pause during gold‑market closures, including weekends.

How the PAXG‑USDC Loan Works

PAXG represents one fine troy ounce of physical gold held in custody, and fractional ownership is possible. On Coinbase’s Borrow platform, users can select PAXG as collateral for either fixed‑ or variable‑rate USDC loans, subject to the exchange’s general eligibility rules for verified customers in the United States (excluding New York), Canada and limited UK access. The loan‑to‑value (LTV) ratio, borrowing caps and liquidation thresholds are asset‑specific and displayed in the loan overview.

Pricing and Risk Management

CryptoSlate notes that PAXG collateral prices update roughly 23 hours per weekday, mirroring gold‑market hours, and pause when those markets close. This pause can delay the reflection of price movements in the loan’s health metrics, potentially affecting liquidation timing. Coinbase offers an optional collateral top‑up protection, but the company warns that liquidation can still occur even when the protection is enabled.

Regional Availability and Future Integration

Paxos currently restricts PAXG to non‑EU residents, and Coinbase’s borrowing product follows the same limitation. The exchange indicated that additional integrations with Paxos are expected in the coming weeks, though product availability may vary.

What to Watch Next

Observers should monitor how the weekend price pause impacts loan health for borrowers, any adjustments to borrowing limits or liquidation thresholds, and whether Coinbase expands PAXG borrowing to additional jurisdictions or adds further gold‑backed assets to its lending suite.