THE EVOLUTION OF DEFI LENDING

 

In 2017, Aave (then known as ETHLend) and Compound emerged as the first DeFi lending platforms, enabling peer-to-peer crypto borrowing and lending. Their new model circumvented traditional intermediaries, offering a simpler, more accessible approach to financial services with ETH as collateral. In 2018, lending protocols introduced liquidity pools, credit delegations, flash loans, gas optimization, stablecoin integrations and more, which offered enhanced efficiency and flexibility for users who were looking to leverage their digital assets. 

 

But what comes next?

 

WHY WE INVESTED IN MORPHO

 

Recognizing both the potential and limitations within existing lending protocols, Morpho set out to develop a more robust, user-controlled risk assessment platform with a unique lending pooling and matching system. Their system effectively narrows the spread between lenders and borrowers and allows end users to select who assesses risks as opposed to most DeFi protocols that are managed by third-party risk assessors. Morpho recently surpassed $2 billion in supplied funds, making it one of the fastest-growing DeFi protocols in the market.

 

The Morpho team has also recently announced the launch of Morpho Blue, a decentralized protocol which enables overcollateralized lending and borrowing of any digital asset. This protocol is a base layer upon which many other applications and protocols are built, including MetaMorpho, their protocol for noncustodial risk management. MetaMorpho enables risk experts to create a vault that aggregates and allocates user liquidity into one or more Morpho Blue markets.

 

The team, comprised of individuals from technical backgrounds who have dedicated years towards researching advanced topics within crypto, founded Morpho during university. Leading the charge as CEO, Paul Frambot brings his blockchain engineering expertise from TelecomParis & Polytechnique. Merlin Egalite adds extensive software engineering experience from roles at The Commons Stack, Kleros, Blockpulse, and Paris Digital Lab. Mathis Gontier Delaunay, who previously served as Vice President at Kryptosphere, now heads research, and Julien Thomas, with his master’s in Data from Polytechnique Montreal, directs development efforts.

 

We’re excited to join a16z, Variant, Coinbase, Mechanism and more in supporting the Morpho team as they continue improving the DeFi lending space.

 

If you would like to learn more about Morpho, please visit their website here or for data analytics, please visit their Dune Analytics page here.