A market is defined by five parameters
Morpho Blue, described in the current documentation as a variable-rate market, identifies each market through a loan asset, collateral asset, oracle, liquidation loan-to-value threshold and interest-rate model. These market parameters are fixed when the market is created. Lending to one market does not automatically diversify a position across every Morpho market.
Lending and supplying collateral differ
Lenders supply the loan asset and earn interest from borrowing. Borrowers post the designated collateral and borrow the loan asset within the market's risk limits. The oracle values collateral in loan-asset terms. Supplying collateral alone is not the same operation as supplying loan assets to earn lending yield.
Market balances versus vault allocations
A curated vault can allocate deposits among markets, adding its own allocation and permission model. Morpho Blue's protocol TVL is a broader observation than the balance or available liquidity of one selected market. A large combined balance does not establish that a particular collateral can be liquidated efficiently or that a lender can withdraw immediately.
Inspect the complete market identity
- Two markets with the same token pair can have different oracles or liquidation thresholds.
- Withdrawal depends on available liquidity; high utilization can constrain exits.
- Read oracle, collateral and bad-debt assumptions before applying a generic lending scenario model.