Curated Vaults

What it actually means

A single Morpho Blue market is narrow by design: one collateral asset, one loan asset, one LLTV. Lending directly into one market means picking that exact risk yourself. Curated vaults, built on Morpho's MetaMorpho standard, sit one layer above. You deposit a single asset, for example USDC, into the vault, and a curator allocates that capital across several underlying Morpho Blue markets on your behalf.

In exchange for your deposit you receive an ERC-4626 vault token that represents your share of the pool. The curator, a risk manager such as Gauntlet, Steakhouse, or Re7, decides which markets the vault lends into, how much to allocate to each, and a supply cap per market that limits concentration. You get diversification and a managed allocation without having to evaluate each market yourself.

How it works

Your yield is a weighted blend of the rates earned across the markets the vault lends into:

The curator continuously rebalances within the policy: moving capital toward markets with better risk-adjusted rates, respecting the supply cap on each market, and avoiding markets that fall outside the vault's mandate. Because allocation can change, your blended yield moves over time as the curator reallocates and as the underlying market rates shift with utilization.

Why it matters to you

Depositing into a curated vault is a decision to delegate risk to the curator. That convenience comes with real dependencies:

• Your true risk is the set of underlying markets the vault lends into, including the collateral assets and the LLTV of each market.
• A high reported APY can come from allocation to riskier markets, so the yield and the risk are linked.
• Supply caps limit concentration, but a market with bad debt still affects every depositor in the vault proportionally.
• You are trusting the curator's judgment on which markets to enter and how to rebalance, not just the Morpho protocol itself.

Real example

You deposit $20,000 of USDC into a curated USDC vault managed by a risk firm. The curator has allocated the vault across three Morpho Blue markets: a wstETH/USDC market earning about 6%, a cbBTC/USDC market earning about 5%, and a more conservative market earning about 4%, each under its own supply cap. Your blended yield lands somewhere between those rates, weighted by how much sits in each market, minus the vault's performance fee. If the curator later shifts more capital into the higher-rate market, your blended yield rises, and so does your exposure to that market's collateral and LLTV.

Common misconceptions

A curated vault is not a single, uniform yield product. The headline APY is an average that hides what sits underneath, and two vaults paying the same rate can carry very different risk depending on their market choices. It is also wrong to assume the curator removes all risk. The curator manages allocation, but the credit risk of the underlying markets, including the possibility of bad debt, still flows back to depositors.

How Otomato monitors it

Otomato detects your curated vault positions automatically, with no setup, and looks through the vault token to the markets it actually lends into. The default rules watch what materially affects a depositor: a meaningful drop in blended yield, large reallocations or cap changes by the curator, and security or solvency signals in any underlying Morpho Blue market your vault is exposed to. You hear from Otomato only when one of those changes the risk or return of your deposit. Silence means the curator's allocation is holding and your yield is intact.

Monitor this in your portfolio

Otomato detects your positions automatically and alerts you only when something material changes. No setup, no signatures.

App StoreGoogle Play

Or try on Telegram