Pyth Partners with Morpho and Gauntlet to Enhance DeFi Lending
Pyth Network, a provider of real-time market data for blockchain applications, has teamed up with decentralized finance (DeFi) development teams Morpho and Gauntlet to improve lending and borrowing experiences on Ethereum and Base. This partnership aims to offer more efficient and secure lending protocols by utilizing Pyth’s low-latency price data.
Efficient Lending with Low-Latency Data
Michael Cahill, co-founder and CEO of Douro Labs, a core contributor to Pyth, highlighted the significance of Pyth Network’s low-latency price data in providing DeFi protocols with the most current market prices. This reduces the risk of outdated information leading to incorrect pricing and transaction execution.
Morpho’s Lending Platform Overhaul
Morpho is launching a lending platform to support permissionless market creation. This platform allows for entity pre-approval to “launch bespoke vaults” with custom risk management specifications. Morpho aims to simplify DeFi yield management for investors and provide DeFi protocols with flexibility in setting parameters such as liquidation loan-to-value (LTV) ratios, price oracles, collateral selection, and caps.
Cahill explained that Morpho’s Blue implements isolated lending vaults, enabling it to decouple from underlying incumbents like Aave and Compound. This concept modularizes risk management, allowing curators to parameterize risk for each isolated vault.
Gauntlet’s Yield Optimization
Gauntlet, a yield farming primitives creator and one of Morpho’s first approved vault operators, will operate a USD Coin (USDC) Core MetaMorpho Vault on Morpho. Gauntlet aims to improve price data accuracy and reliability by integrating Pyth’s pull method price oracle, which actively acquires data from a source rather than passively receiving it.
Cahill emphasized the importance of real-time price data, noting that its availability has driven the recent surge in high-throughput DeFi applications, including perpetual futures and on-chain derivatives.
Impact of Pyth Data Feeds
Pyth’s data feeds, characterized by low-cost and high-frequency updates, are designed to secure and stabilize the informational feed provided to decentralized applications. Lending protocols like Morpho benefit from using data that aggregates numerous primary sources to provide robust and trustworthy price measurements. These prices can be reliably used for collateral valuation, liquidation triggers, and yield settings.
Pyth currently has $7 billion in total value locked and provides price feeds to more than 350 DeFi protocols across various blockchains.
