Founders

Introducing Pre-Liquidations

An open-source smart contract factory that enables applications built on Morpho to offer borrowers opt-in loan management features, such as auto deleverage and auto close.

Earn, Borrow, Build on Morpho 
/morpho and app.morpho.org

While Morpho's default liquidation system prioritizes lenders with strong guarantees, pre-liquidations give borrowers more options to manage their positions according to their goals.

For example, specific pre-liquidation contracts can allow borrowers to enable auto deleverage or auto close for their positions.

Auto Deleverage

Instead of closing the entire position when it becomes unhealthy, auto deleverage aims to close only enough of the position to restore its health.

This allows borrowers to keep positions open as much as possible while reducing liquidation penalties.

Auto Close

The goal of an auto close is to mitigate the loss borrowers would incur from a default liquidation.

By opting into this configuration, borrowers can accept earlier liquidation in exchange for a significantly reduced liquidation penalty.

Both @spearbitdao and ABDK have audited the code for Pre-Liquidations. 

Key specifications have also been formally verified using @certora.

The contract is included in Morpho's $1.5M bounty program on 
@immunefi and Cantina.

Both @spearbitdao and ABDK have audited the code for Pre-Liquidations. 

Key specifications have also been formally verified using @certora.

The contract is included in Morpho's $1.5M bounty program on 
@immunefi and Cantina.

https://github.com/morpho-org/pre-liquidation

Pre-liquidations extend what's possible on Morpho, giving borrowers access to enhanced loan management features.

For more details on pre-liquidations, read our full announcement here:

Pre-liquidations extend what's possible on Morpho, giving borrowers access to enhanced loan management features.

For more details on pre-liquidations, read our full announcement here:
https://morpho.mirror.xyz/eRDN52JC2Xa2P-U-3A-3PwxYbRD5sbewIi64V24XXmE

Using the factory, anyone can deploy a contract containing custom liquidation parameters for any Morpho Market that would occur prior to default liquidations.

By authorizing a contract, borrowers can customize when liquidations trigger, what percentage of a position closes, and associated penalties.

you probably don’t think about liquidity enough // it is what it is  // build value, not valuation

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This is just for Morpho Markets. But anyone building on top of Morpho can use it.

Can other borrow/lend market build on top of this?