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MorphoAligning Around MORPHO — The Only Asset For Morpho
TL;DRMorpho will have only one asset—the MORPHO token. This single-asset approach ensures complete alignment between the network of contributing entities and the Morpho DAO (MORPHO token holders). To clarify this alignment, Morpho Labs is becoming a wholly-owned subsidiary of the Morpho Association to eliminate any perceived conflicts with equity value and ensure that token holders and these contributing entities share the same incentive. As the Morpho DAO explores introducing protocol fees t...
MorphoUnderstanding Morpho Vaults: Enabling Diverse Risk Profile
Morpho Vaults (formerly known as MetaMorpho Vaults) combines the best of isolated markets and multi-asset lending pools to create a better way to lend. In time, we believe Morpho Vaults will become the default lending solution. Last week, we introduced the Understanding Morpho Vaults article series with Part One: Intro to the Morpho Approach & Simplifying Isolated Markets. Today, we share Part Two: Enabling Diverse Risk Profiles to explain how, unlike the traditional one-size-fits-all approac...
MorphoMorpho’s Mission: Making Financial Infrastructure A Public Good.
This article articulates Morpho's mission, serving as a guiding principle for its decentralizing DAO. It ensures contributions to Morpho remain focused on its overarching goals, rather than chasing fleeting trends.Why financial infrastructure should be a public goodFinancial infrastructures form the backbone of any economy. They are foundational systems where participants in multi-sided markets come together to settle financial operations. Yet, every layer of the financial infrastructure...
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Morpho Vaults combines the best of isolated markets and multi-asset lending pools to create a better way to lend. In time, we believe Morpho Vaults will become the default lending solution.
Today, we are introducing a four-part series explaining why, starting with Part One: Intro to the Morpho Approach & Simplifying Isolated Markets.
There are two main approaches to structuring lending markets in decentralized finance: lending pools and isolated markets. The former excels in providing a straightforward user experience and aggregates liquidity but lacks the efficiency and flexibility needed for significant scalability. Conversely, the latter unlocks notably higher levels of efficiency and flexibility but introduces a more complex user experience and liquidity fragmentation.
So, the question arises: How does one combine the simple user experience and aggregated liquidity of lending pools with the efficiency and flexibility of isolated markets.
The answer: Morpho + Morpho Vaults
Morpho (formerly known as Morpho Blue) is a remarkably simple and immutable lending primitive that enables the permissionless creation of isolated markets. MetaMorpho is a separate protocol for creating MetaMorpho Vaults (lending vaults) on top of Morpho Blue.
Although built independently, MetaMorpho vaults are fully integrated into Morpho Blue. At the base layer, Morpho Blue provides efficient, secure, and flexible isolated markets. Built on top, MetaMorpho vaults simplify the lending user experience and aggregate liquidity offering users the best of both isolated markets and lending pools.
First and foremost, a Morpho vault makes lending to isolated markets as simple as a lending pool.
When using a multi-asset lending pool, a lender only has one option, however, with isolated markets, there could be several markets for one loan asset. For example, Morpho could have five options to lend USDC: sDAI/USDC, wstETH/USDC, wbIB01/USDC, WBTC/USDC, and WETH/USDC.
Each market also has parameters such LLTV, oracle, and supply caps that lenders must consider. In other words, users are required to perform risk management themselves.
A Morpho vault eliminates the complexity of risk management by creating a single point of entry. Rather than requiring users to make multiple decisions, they can simply deposit USDC into a USDC Morpho Vault to allocate liquidity.
Not only does it make it easier to supply, but it helps to improve yield. As market conditions change, a vault can rebalance across markets to optimize interest earned by lenders.
In the end, Morpho Vaults provide users with the same simple user experience as a multi-asset lending pool with the benefits of lending to isolated markets.
This marks the end of part one of the Understanding Morpho Vaults series. Next week, we will release Part Two: Enabling Diverse Risk Profiles.
Make sure you are subscribed to Morpho to receive notifications.
Morpho Vaults combines the best of isolated markets and multi-asset lending pools to create a better way to lend. In time, we believe Morpho Vaults will become the default lending solution.
Today, we are introducing a four-part series explaining why, starting with Part One: Intro to the Morpho Approach & Simplifying Isolated Markets.
There are two main approaches to structuring lending markets in decentralized finance: lending pools and isolated markets. The former excels in providing a straightforward user experience and aggregates liquidity but lacks the efficiency and flexibility needed for significant scalability. Conversely, the latter unlocks notably higher levels of efficiency and flexibility but introduces a more complex user experience and liquidity fragmentation.
So, the question arises: How does one combine the simple user experience and aggregated liquidity of lending pools with the efficiency and flexibility of isolated markets.
The answer: Morpho + Morpho Vaults
Morpho (formerly known as Morpho Blue) is a remarkably simple and immutable lending primitive that enables the permissionless creation of isolated markets. MetaMorpho is a separate protocol for creating MetaMorpho Vaults (lending vaults) on top of Morpho Blue.
Although built independently, MetaMorpho vaults are fully integrated into Morpho Blue. At the base layer, Morpho Blue provides efficient, secure, and flexible isolated markets. Built on top, MetaMorpho vaults simplify the lending user experience and aggregate liquidity offering users the best of both isolated markets and lending pools.
First and foremost, a Morpho vault makes lending to isolated markets as simple as a lending pool.
When using a multi-asset lending pool, a lender only has one option, however, with isolated markets, there could be several markets for one loan asset. For example, Morpho could have five options to lend USDC: sDAI/USDC, wstETH/USDC, wbIB01/USDC, WBTC/USDC, and WETH/USDC.
Each market also has parameters such LLTV, oracle, and supply caps that lenders must consider. In other words, users are required to perform risk management themselves.
A Morpho vault eliminates the complexity of risk management by creating a single point of entry. Rather than requiring users to make multiple decisions, they can simply deposit USDC into a USDC Morpho Vault to allocate liquidity.
Not only does it make it easier to supply, but it helps to improve yield. As market conditions change, a vault can rebalance across markets to optimize interest earned by lenders.
In the end, Morpho Vaults provide users with the same simple user experience as a multi-asset lending pool with the benefits of lending to isolated markets.
This marks the end of part one of the Understanding Morpho Vaults series. Next week, we will release Part Two: Enabling Diverse Risk Profiles.
Make sure you are subscribed to Morpho to receive notifications.
MorphoAligning Around MORPHO — The Only Asset For Morpho
TL;DRMorpho will have only one asset—the MORPHO token. This single-asset approach ensures complete alignment between the network of contributing entities and the Morpho DAO (MORPHO token holders). To clarify this alignment, Morpho Labs is becoming a wholly-owned subsidiary of the Morpho Association to eliminate any perceived conflicts with equity value and ensure that token holders and these contributing entities share the same incentive. As the Morpho DAO explores introducing protocol fees t...
MorphoUnderstanding Morpho Vaults: Enabling Diverse Risk Profile
Morpho Vaults (formerly known as MetaMorpho Vaults) combines the best of isolated markets and multi-asset lending pools to create a better way to lend. In time, we believe Morpho Vaults will become the default lending solution. Last week, we introduced the Understanding Morpho Vaults article series with Part One: Intro to the Morpho Approach & Simplifying Isolated Markets. Today, we share Part Two: Enabling Diverse Risk Profiles to explain how, unlike the traditional one-size-fits-all approac...
MorphoMorpho’s Mission: Making Financial Infrastructure A Public Good.
This article articulates Morpho's mission, serving as a guiding principle for its decentralizing DAO. It ensures contributions to Morpho remain focused on its overarching goals, rather than chasing fleeting trends.Why financial infrastructure should be a public goodFinancial infrastructures form the backbone of any economy. They are foundational systems where participants in multi-sided markets come together to settle financial operations. Yet, every layer of the financial infrastructure...
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