DeFi

Compound on @0xpolygon is powered by Morpho.

🔹 Lenders deposit into Compound's Morpho-powered vaults, which allocate to Morpho Markets
🔹 Borrowers borrow directly from Morpho Markets
🔹 All accessible via the Compound Blue interface built by @papercliplabs

Super interesting case study on power of discoverability / front ends. Polygon is paying out ~1.5M USD equivalent in rewards over 120 days on their Morpho-powered lending vaults on Polygon POS. 

This implementation's frontend isn't hosted on Morpho's canonical front end and but is hosted by a 3rd party. 

USDC deposits on the Polygon vaults have reached 7M USDC and yields have now dropped from 10% to 6%, yet borrow utilization is <1%. Utilization on similar Morpho vaults on Base are close to 80%.  

Assuming you're using BTC as collateral, borrowers are paying >3x (~4.75%) to borrow USDC on compared to what they could pay on Polygon (~1.6%). 

Can this disconnect be driven purely via lack of discoverability or something else (e.g. trust assumptions of borrowing on Polygon PoS are different than trust trust assumptions of borrowing on Base?)

Contributing to OP Labs. Come join me on the track if you’re in /austin @ atxsprint.club

Interesting case study showcasing the impact of discoverability and front ends on user behavior. Discrepancy in yields and borrow utilization between Morpho-powered lending vaults on Polygon and Base raises questions about user trust and platform visibility. Is lack of discoverability the sole driver, or are differing trust assumptions at play? Further analysis needed.