Crypto.com Taps Morpho to Let Users Earn Stablecoin Yield
Wrapped Assets for Stablecoin Yield
Crypto.com will integrate the decentralized finance protocol Morpho into its platforms, allowing users to borrow stablecoins against wrapped crypto assets and earn yield, the firms said Thursday. Morpho will launch lending markets on the Cronos blockchain later this year, with vaults supporting wrapped BTC (CDCBTC) and Ether (CDCETH).
Wrapped assets represent cryptocurrencies on other blockchains, letting users bring value into Cronos without bridging to external networks. Depositors will be able to post wrapped BTC or ETH and borrow stablecoins, with lending markets managed directly through the Crypto.com interface.
“The goal is to provide a trusted user experience in the front, with DeFi infrastructure in the back,” Morpho co-founder Merlin Egalite told Cointelegraph. He added the protocol would be open to U.S. users, arguing that lending stablecoins to earn yield is distinct from issuers paying yields directly—an activity restricted by the U.S. Genius Act.
Investor Takeaway
Morpho’s Rise in DeFi Lending
Morpho has emerged as the second-largest DeFi lending protocol later than Aave, with about $7.7 billion in total value locked, according to DefiLlama. The protocol works as a matching layer on top of existing platforms such as Aave and Compound, optimizing rates for both lenders and borrowers.
The tie-up with Crypto.com follows a similar arrangement with Coinbase announced Sept. 18. In that deal, Coinbase integrated Morpho vaults into its app, managed by DeFi advisory firm Steakhouse Financial, allowing customers to lend USDC without leaving the platform. Coinbase said users could access yields of up to 10.8%, well above the 4.5% annual rewards it currently pays for holding USDC on its platform.
The two integrations highlight how centralized platforms are moving to incorporate DeFi services into their platforms to retain customers and expand revenue streams. They also underline a growing convergence between regulated platforms and onchain markets.
Regulation and the Genius Act
The U.S. Genius Act, signed into law in July 2025, banned issuers from offering interest-bearing stablecoins but stopped short of outlawing yields earned via DeFi lending. This distinction has created a gray area that companies such as Coinbase and Crypto.com are now using to roll out yield-bearing .
Egalite said Morpho’s activities were outside the scope of the Act since “lending a stablecoin and earning yield is a separate activity, independent of the issuer.” That interpretation could face tests as regulators weigh how far lending products overlap with the spirit of the ban.
Banking groups have pushed back. In August, the Bank Policy Institute and several U.S. financial institutions wrote to Congress claiming stablecoin loopholes could drain as much as $6.6 trillion in deposits from the U.S. banking system. Coinbase rejected the charge in a Sept. 16 blog post, saying there is no evidence of deposit flight and accusing banks of protecting card processing fees that stablecoins could bypass.
Investor Takeaway
Crypto platforms and the Push Into Banking Territory
Coinbase CEO Brian Armstrong said in September the company wants to evolve into a full-service crypto “super app,” offering lending, payments, and other financial services that could replace traditional banks. Crypto.com’s adoption of Morpho signals a similar strategy of embedding DeFi infrastructure into its core platform.
For investors, the integrations highlight how leading platforms are moving to offer bank-like services while staying within new legal boundaries. Stablecoin lending markets on Cronos could expand Crypto.com’s appeal in Asia, while Coinbase is testing demand among U.S. customers. Both moves illustrate the broader contest between banks for yield-hungry clients.
