Morpho (MORPHO) is the governance token for the Morpho protocol, a decentralized, non-custodial lending and borrowing platform built on Ethereum and other EVM-compatible blockchains. Its primary function is to allow holders to participate in the protocol's decentralized autonomous organization (DAO) governance and influence its future direction.
Key Information about MORPHO
Function: The MORPHO token is mainly used for decentralized governance, enabling token holders to propose and vote on protocol upgrades, risk parameters, and strategic decisions.
Protocol Overview: Morpho enhances traditional DeFi lending platforms like Aave and Compound by introducing a peer-to-peer (P2P) matching layer, directly connecting lenders and borrowers to reduce interest rate spreads and improve capital efficiency.
Mechanism: If a direct P2P match isn't immediately available, the protocol seamlessly falls back on existing liquidity pools, ensuring that assets continue to generate yield without disruption.
Features:
Morpho Markets: Allow for the creation of isolated lending markets with specific collateral types and risk parameters.
Morpho Vaults: Non-custodial, simple-to-use lending vaults that optimize yields for depositors by allocating funds across different markets.
Supply: The total and maximum supply of MORPHO tokens is 1 billion, with a circulating supply of approximately 360 million MORPHO as of late November 2025.
Recent Developments and News
Institutional Adoption: Coinbase has integrated the Morpho protocol to offer ETH and Bitcoin-backed loans for eligible U.S. users, highlighting growing institutional trust and demand for crypto-native credit tools.
Major Backing: Morpho has raised over $69 million in funding rounds from major investors, including a16z crypto, Pantera Capital, and Coinbase Ventures.
Roadmap: The protocol's future roadmap focuses on institutional expansion, integration with stablecoins (like GHO), and the continued rollout of Morpho V2, which introduced fixed-rate loans and cross-chain support.
