Morpho Labs and Gelato Network have partnered to unveil Embedded Crypto-Backed Loans, a new solution enabling users to access non-custodial, crypto-backed loans seamlessly within wallets, exchanges, and fintech applications. This initiative simplifies borrowing stablecoins like USDC by using cryptocurrencies, including Bitcoin, as collateral.
The platform focuses on enhancing usability, delivering a Web2-like experience with features such as one-click borrowing, wallet creation via social logins, and gasless transactions. Supported blockchains include Polygon, Arbitrum, Optimism, and Scroll, with upcoming support for Katana and additional chains planned.
Morpho, boasting over $6.5 billion in total value locked, provides decentralized lending infrastructure, while Gelato offers smart wallet and gas abstraction tools that facilitate smooth user experiences. The new embedded loan product is fully onchain and governed by smart contracts, requiring no credit checks and designed for both retail and institutional users.
Additional security enhancements like multi-factor approval and onchain recovery modules are expected later in the year. The collaboration aims to bridge the usability gap between DeFi and traditional finance, making self-custodial crypto loans more accessible than ever.