It's easy to miss it because Morty spends most of the exchange angry and flips into attacking pretty quickly, but for a second he does look genuinely scared when Eddie is threatening him. He even tells him to stop. It makes me so sad for him because, no matter how badass and competent he becomes, he's still just a scared kid in these traumatising situations. I even wonder if he was reminded of the Mr Jellybean incident - trapped in a small space alone with a grown man trying to hurt him and without Rick to protect him.