Morpho DeFi Protocol has made a significant move by becoming the first layer-2 protocol to launch on Base, an L2 scaling network for Ethereum introduced by Coinbase in 2023. Originally launched on the Ethereum blockchain, Morpho’s expansion onto Base is seen as a strategic move to tap into the growing DeFi ecosystem.
CEO of Morpho Labs, Paul Frambot, initially had reservations about expanding onto a second chain but has now embraced the idea. In a recent post, Frambot expressed confidence in Morpho’s potential to become the top lending and borrowing protocol on Base.
The launch of Morpho on Base introduces new features for the community to benefit from, including MetaMorpho Vaults that offer optimized yields through passive lending. Users can earn by depositing assets into these vaults and also have the option to borrow from Morpho Markets using collateral. For example, the cbETH/USDC market allows users to borrow the USDC stablecoin with cbETH as collateral.
With Base gaining traction in the market, the potential influx of new users will be crucial for Morpho’s growth. According to DeFiLlama data, Morpho currently has a total value locked (TVL) of $1.82 billion, a significant increase from the $597 million TVL recorded at the beginning of the year. This suggests that the on-chain P2P layer has experienced a 205% TVL increase year-to-date.
The deployment of Morpho on Base marks a milestone for the protocol, opening up new opportunities for users to earn, borrow, and build within the DeFi ecosystem. As the first layer-2 protocol on Base, Morpho is well-positioned to capitalize on the network’s scalability and efficiency advantages, potentially outpacing the Ethereum version in the coming year.
Overall, Morpho’s expansion onto Base signifies a strategic decision to leverage the growing DeFi landscape and provide users with innovative features for liquidity, lending, and borrowing. With a focus on enhancing capital utilization rates and offering a seamless user experience, Morpho is poised for continued growth and success in the evolving DeFi space.