#morpho $MORPHO

Morph Protocol was established in 2021 and is a company based in France under the name Morph Lab. It has raised a total of $70 million in funding from Ribbit Capital, a16z Crypto, Coinbase Ventures, Variant, Brevan Howard, Pantera, Blocktower, and more than 100 others to support its mission of making financial infrastructure a public good. The CEO and founder of Morph is Paul Frambois, while the co-founder is Merlin Egalite.

Mechanism of Morpho Protocol

To borrow assets, a user must provide collateral as a crypto asset backed by the Morpho Protocol.

The protocol defines the minimum collateral value required relative to the borrowed assets. For example, if this ratio is 90%, the value of the borrowed assets must not exceed 90% of the collateral value, or the position is eligible for liquidation.

The user initiates the borrowing process by interacting with the Morpho Protocol. They specify the amount of assets they wish to borrow and provide the required collateral.

Borrowers pay interest on the borrowed amount. The amount of interest paid depends on the interest rate model used by the protocol. Interest accrues over time and must be paid when the borrower repays the loan.

Borrowers can repay the loan at any time by returning the borrowed assets plus the accrued interest. Once the blockchain confirms the repayment of the debt, the borrower can retrieve their collateral from the smart contract.

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