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Learn more about the Morpho Protocol
Decentralized protocols like AAVE and Compound work by being accessible at any time, to do this lending markets require overcollateraization of loans and have to maintain high spreads between lenders and borrows to maintain stability in their markets.
Morpho makes DeFi more capital efficient by utilizing a Peer to Peer layer on top of lending protocols like Compound and AAVE. This enables both lenders and borrowers to directly connect with one another when there is demand, while maintaining the access and guarantees of the underlying protocol. This guarantees Morpho users the same if not better rates than using these protocols directly.
Matching on Morpho occurs automatically! If your supplied or borrowed amounts find a matching peer, your loan or a portion of your loan will be shifted to P2P rates. On the interface you can check the banner to see if your asset is currently receiving the matched P2P rate or the underlying market or a blended rate.
Whenever you are matched you will receive the P2P rate.
Yes! You will receive the same rates and the same rewards from any protocols used through Morpho. Morpho may also incentive users with their own token!