Morpho Blue introduces liquidity stratification, a major shift where each lending market exists independently with its own rules for liquidity depth, volatility, and collateral. This solves the weakness of monolithic pools that forced assets with dramatically different risk profiles to share the same parameters.
By allowing markets to set specialized constraints, Morpho enables tailored credit environments, such as:
Short-term stablecoin borrowing with minimal volatility risk.
High-yield structured markets for risk-tolerant providers.
This stratification allows liquidity to self-organize efficiently. Crucially, this isolation ensures that underperformance in one market does not compromise the integrity of the entire system. Morpho is transforming lending into a flexible, sophisticated capital network.
