The Morpho Mechanism — A Smarter Way to Lend and Borrow
Here’s how it works in simple terms:
When you supply assets to Morpho, your funds are deposited into the underlying lending protocol (like Aave or Compound). But instead of being left idle in a pool, Morpho automatically searches for matching borrowers who need those exact assets.
When a match is found, the transaction becomes peer-to-peer, offering both sides better rates. If no direct match exists, your funds remain in the lending pool earning regular interest—so you’re never losing out.
This mechanism ensures capital efficiency, meaning your assets are always working optimally.
Why $MORPHO Matters
The native token, $MORPHO, plays a vital role in the protocol’s ecosystem. It represents governance, incentives, and alignment of interests between participants. Holders of $MO$MORPHO to shape the protocol’s future, vote on proposals, and influence key decisions about upgrades, integrations, and community development.
But beyond governance, $MORPHO also serves as a symbol of contribution and innovation. Every holder becomes a stakeholder in the future of decentralized finance—one where efficiency is not a luxury, but the standard.
