Robinhood has launched a decentralized lending product directly inside its main app. The new "Robinhood Earn" feature allows eligible U.S. users to lend USDG stablecoins through Morpho protocol vaults to earn an estimated 7% annual percentage yield.
The product operates through a self-custody wallet. Users lend the regulated dollar-pegged stablecoin issued by Paxos, with the lending infrastructure running on Morpho, an independent DeFi protocol. Robinhood has partnered with Steakhouse Financial and Maple to integrate institutional credit strategies.
A key feature is insurance coverage against losses from cyber incidents or smart contract exploits, provided through Lloyd's of London and RELM.
The launch coincides with the unveiling of Robinhood Chain, an Arbitrum-based Layer-2 mainnet. The MORPHO token price surged over 12% following the announcement.
This offering represents a significant bridge between traditional finance and decentralized finance, simplifying access to DeFi yields for Robinhood's large user base of approximately 24 million funded accounts.