Project Title: MORE Vaults
Organization name: MORE Laboratories
Organization website and/or social media links: https://more.markets, @MORE_Protocol
About us + prior experience: The MORE team has been working in the crypto space for more nearly 4 years. In our early days, we built reputation tooling and rewards programs for communities and DAOs across EVMs like Polygon, Gnosis and Ethereum as well as Solana and Flow. Since June 2024, we have been working in close collaboration with the Flow Foundation to deploy a DeFi ecosystem on that chain. We now have more than 6 months of experience working with the Morpho protocol including experimenting a fork on testnet which would facilitate undercollateralized lending through a TradFi third party. While this particular implementation is solely an experiment, we now are proficient in the functioning of the protocol as well as the maintenance of a front-end. As we deploy Flow’s core lending protocol, we are looking ahead at ways of increasing the underlying lending protocol’s capital efficiency, while offering a layer of additional abstraction on DeFi for passive lenders and long-term holders.
Leading Contributor(s):
Patrick Perlmutter Twitter, LinkedIn
Michael Rozalenok Github
Leon Lin Github
Requested budget: 35k MORPHO
Scope of Work: Expand the functionality of Morpho Vaults so that curators can post and withdraw collateral, borrow and repay loans and deploy borrowed assets into Morpho markets. By extending curation to other functions on Morpho, passive depositors can take advantage of more advanced DeFi strategies managed by professional traders and risk managers such as looping, initially. The initial deployment of these vaults will focus solely on correlated assets such as wstETH, ETH, rETH, rzETH, etc. The project’s aim is to abstract the complexity of DeFi and the myriad options offered by other looping protocols (e.g. Origami, Contango, etc.) by instead aggregating multiple loops or strategies into one or potentially many, curated ones. This new vault will lay the foundation of a protocol that operates on Morpho and consumes idle liquidity on the underlying markets to increase leverage for users as well as capital efficiency for lenders. The initial deployment can be done on Ethereum, Base, Flow or any other chain (depending on the Morpho DAO’s approval of deployments on other chains subsequent to approval of MIP-87). While a deployment of MORE Vaults on Ethereum makes the most sense to start, the ultimate decision will account for transaction costs such as loan origination, repayments, moving collateral between markets and withdrawing funds. Part of the deployment of MORE Vaults will involve whitelisting liquidity pools on leading AMMs such as Uniswap in order to support swaps between assets (specifically ones with unbonding periods) involved in the underlying strategy. Because of the focus on correlated assets, the level of risk of these early deployments is fairly mitigated.
Benefit for the Morpho Ecosystem:
The ultimate goal of the project is threefold:
- improve the user experience for passive crypto holders by offering them opportunities to hold a yield-maximized, risk-minimized version of yield-bearing tokens;
- Optimize the capital efficiency of underlying markets by using idle liquidity resulting in improved rates for lenders; and
- Offer curators increased profitability thanks to ability to generate additional fees on yield from these strategies.
Metrics: Achieve $5M TVL in the 6 months following the launch of the first vault
Timeline: Three months for research, development and testing. In this first version a simple vault deposit and withdrawal UI will allow users to enter and exit the strategies. Participating depositors will hold a MORE vault token that accrues yield and can be burned in exchange for the withdrawal.
Future directions: As we grow TVL on MORE Vaults, we intend to:
- Increase the number of curated strategies on the protocol;
- Implement new strategies such as yield farming and basis farming off-protocol;
- Create additional abstractions that group together strategies into indexes (e.g. moreETH, moreUSD, etc.).