DeFi lending platform Morpho offers fixed-rate and fixed-term loans while allowing lenders and borrowers to set their own terms.
Decentralized lending platform Morpho has unveiled a new version of its product that adds a number of features, including fixed-rate and fixed-term loans, according to a company blog post published yesterday, June 12.
Morpho is currently the second-largest lending protocol in decentralized finance (DeFi), with over $6 billion in total value locked (TVL). Morpho’s TVL increased 150% just a few months after its token, MORPHO, launched in November 2024. The protocol’s native token is currently trading near $1.40, down over 8% today in the broader market downturn, but up almost 10% this week.
Morpho V2 offers more bespoke and more predictable loan terms, bringing DeFi closer to traditional finance, the platform’s co-founder CEO, Paul Frambot, wrote in the post. One goal is to make DeFi more comfortable to enterprises and institutions interested in exploring on-chain finance.
Choose Your Own Terms
Morpho V2 has two core components, Morpho Markets V2 and Morpho Vaults V2. These build on previous versions’ immutable, permissionless and externalized risk curation, but with new capabilities.
Among these is offered liquidity, meaning lenders make offers instead of sending capital to lending pools, and borrowers are free to seek bespoke loan terms, Frambot said in the blog post.
“All loan offers are broadcast to a single global market, ensuring users receive the best possible terms,” Frambot wrote. One facet of this is market-driven rather than formula-driven pricing. Another is flexible loan terms, allowing the use of single assets, multiple assets or even whole portfolios as collaterals. This opens up the possibility of using tokenized real-world assets and niche assets, as opposed to being stuck with single asset loans.
Cross-chain compatibility means lenders can make liquidity available across multiple chains like Ethereum, Base and OP Mainnet, Morpho said, allowing buyers to decide which chain to settle on.
Morpho is scheduled to roll out in phases, starting with Vaults V2 and then Markets V2, following the completion of security audits.
Morpho V1 Remains
Morpho V1 remains in place, as V2 is intended to be complementary rather than replacing it, the blog posts states. Morpho V1 will still offer variable rate borrowing, while V2 will focus on fixed rate borrowing.
“Users can choose their preferred approach—fixed or variable rates, specific duration or instant liquidity, minimal or bespoke markets,” the post reads.
Morpho is behind a number of crypto companies’ lending programs, with firms like Coinbase and payments processor Strike using it to power their lending products.
As The Defiant previously reported, Frambot announced last week that Morpho Labs, the development company behind the lending platform, is becoming a wholly owned subsidiary of the Morpho Association, meaning it will ultimately be owned by MORPHO token holders.
