Coinbase’s fixed-rate Bitcoin loans can put healthy collateral at risk after maturity

Coinbase’s fixed-rate Bitcoin loans may expose borrowers to liquidation or collateral loss if loans remain unpaid at maturity, even when the underlying collateral is otherwise healthy. The risk is amplified by Bitcoin’s volatility and the possibility that borrowers cannot refinance or repay during a downturn. At the same time, institutional participation may be moderating bear-market severity, but it does not eliminate liquidity, refinancing, or counterparty risks for leveraged holders.