morpho-builder

name

morpho-builder

description

Use when building applications, bots, SDKs, or integrations against the Morpho lending protocol — deposits, borrows, repays, withdrawals, vault v1/v2 integrations, V1→V2 migration flows, risk monitors, portfolio dashboards. Steers toward `@morpho-org/morpho-sdk` (`MorphoClient`) for user-facing transactions and flags uncovered flows (curator ops, market creation, liquidations, flashloans, rewards) that need lower-level SDKs. Invoke whenever a user mentions Morpho, MetaMorpho, Morpho Blue, or any on-chain integration touching these contracts — even if they don't name morpho-sdk explicitly.

Morpho Builder Skill

Experimental (pre-v1.0) — SDK recommendations, API schemas, and best practices may evolve as the protocol tooling matures.

Reference guide for building applications that integrate with the Morpho lending protocol. For operating on the protocol directly in a conversation, use the morpho-cli skill instead.

Prefer Morpho v2. The Morpho Optimizer (Morpho-Aave, Morpho-Compound) is deprecated. For new vault deployments, prefer vault v2 over MetaMorpho (vault v1). Note: the two vault versions have incompatible ABIs — use vaultV2Abi for v2 vaults and metaMorphoAbi for v1 vaults. Match the ABI to the on-chain contract.

Protocol Overview

Morpho Blue — isolated lending markets. Each market is defined by five parameters: loan token, collateral token, oracle, interest rate model (IRM), and liquidation LTV (LLTV). Markets are identified by a MarketId (hash of these parameters).

Morpho Vaults v2 — the newer vault contract. ERC-4626 compliant. Allocates deposits across multiple markets via adapters, which can wrap MetaMorpho (v1) vaults and Morpho Blue markets. Preferred for new vault deployments. In the SDK: vaultV2Abi, VaultV2, fetchVaultV2.

MetaMorpho (vault v1) — the original vault contract. Still functional and widely deployed on-chain. In the SDK: metaMorphoAbi, Vault, fetchVault. The two vault versions have incompatible ABIs — use the correct one for the contract you're interacting with.

Singleton contract: 0xBBBBBbbBBb9cC5e90e3b3Af64bdAF62C37EEFFCb — same address on Ethereum (chain 1) and Base (chain 8453) via CREATE2.

Key Entities

Entity	Identifier	Description
Market	MarketId	Isolated lending pool with specific collateral/loan pair
Vault	Address	Multi-market aggregator, ERC-4626. Two versions: v2 (VaultV2) and MetaMorpho v1 (Vault) — ABIs differ
Position	User + Market/Vault	User's supply/borrow in a market or deposit in a vault
Token	Address + decimals	ERC-20 — decimals vary (USDC/USDT = 6, WETH/DAI = 18)

Key Quantities

Quantity	Format	Notes
APY	Decimal (0.0534 = 5.34%)	From GraphQL state.netApy
LLTV	Raw 1e18 (860000000000000000 = 86%)	From SDK or API
Token amounts	Raw units	Divide by 10^decimals for human-readable. Use parseUnits/formatUnits from viem
Health factor	Ratio	≥ 1.0 = safe, < 1.0 = liquidatable

SDK Selection

Default to @morpho-org/morpho-sdk for user-facing flows. It is the high-level abstraction layer that wraps blue-sdk, blue-sdk-viem, bundler-sdk-viem, and simulation-sdk, and handles bundler-vs-direct routing, slippage bounds, LLTV-buffer health checks on borrows, ERC-20 approvals / EIP-2612 permits / Permit2 / Morpho setAuthorization requirements, and native-token wrapping — all internally. Hand-rolling these from the lower-level SDKs is error-prone and duplicates logic morpho-sdk already gets right.

Use morpho-sdk for: vault deposits / withdrawals / redeems (V1 and V2), VaultV2 force-withdraw / force-redeem, V1→V2 migration, Morpho Blue supplyCollateral, borrow (with optional PublicAllocator reallocations), atomic supplyCollateralBorrow, repay (by assets or shares), withdrawCollateral, atomic repayWithdrawCollateral, and per-entity reads (getData, getMarketData, getPositionData).

Drop to lower-level SDKs only for:

• Curator / allocator / owner ops on vaults (setCap, reallocate, role management, timelocks, guardian/sentinel flows)
• Morpho Blue market creation
• Liquidations, flashloans, pre-liquidation, rewards claiming
• Custom bundler compositions beyond the actions listed above
• Portfolio-wide aggregation across many markets / vaults (morpho-sdk exposes per-entity reads only — use blue-sdk-viem fetch helpers or the GraphQL API)

React / wagmi apps: there is no @morpho-org/morpho-sdk-wagmi package. Use @morpho-org/blue-sdk-wagmi hooks for reads, instantiate MorphoClient against the wagmi public client for writes, and pass the buildTx output to wagmi's useSendTransaction.

SDK Registry

All packages are published under @morpho-org on npm.

Package	Purpose
@morpho-org/morpho-sdk	Start here. High-level abstraction wrapping the four SDKs below. Builds user-facing transactions (deposit, borrow, repay, withdraw, migrate) with slippage, approvals, permits, and bundler routing handled internally
@morpho-org/blue-sdk	Core types, entity classes (Market, Vault, VaultV2, Position, MarketParams), and constants. Used internally by morpho-sdk; use directly only for type imports or uncovered flows
@morpho-org/blue-sdk-viem	Viem augmentation — ABIs, fetch helpers (fetchMarket, fetchVault, fetchVaultV2, fetchPosition). Used internally by morpho-sdk; use directly for ABIs, multi-entity reads, or uncovered write flows
@morpho-org/bundler-sdk-viem	Multi-step transaction bundling (approvals, transfers, Morpho ops in one tx). Used internally by morpho-sdk; use directly only for custom compositions beyond morpho-sdk's action set
@morpho-org/simulation-sdk	Framework-agnostic simulation of Morpho operations. Used internally by morpho-sdk; use directly only for standalone what-if simulations
@morpho-org/blue-sdk-ethers	Ethers augmentation — same fetch helpers as viem, for Ethers-based projects
@morpho-org/blue-sdk-wagmi	React hooks (useMarket, useVault, usePosition, etc.) wrapping core SDK. Requires wagmi v2. Pair with morpho-sdk for writes
@morpho-org/blue-api-sdk	GraphQL SDK with typed queries for the Morpho API
@morpho-org/simulation-sdk-wagmi	React hooks for client-side simulation (useSimulationState)
@morpho-org/liquidity-sdk-viem	Liquidity monitoring and bot infrastructure
@morpho-org/liquidation-sdk-viem	Liquidation bot infrastructure
@morpho-org/migration-sdk-viem	Migration from Aave/Compound to Morpho
@morpho-org/morpho-ts	Time and format utilities
@morpho-org/test	Vitest/Anvil test fixtures for Morpho
@morpho-org/test-wagmi	Wagmi test config extension of @morpho-org/test
@morpho-org/morpho-test	Framework-agnostic test fixtures

SDK Details

@morpho-org/morpho-sdk

High-level abstraction. Default entry point for user-facing flows.

Construction — two equivalent forms: new MorphoClient(publicClient) returns a direct client, or publicClient.extend(morphoViemExtension()) attaches the API to a viem public client under .morpho.

Entity factories — all require a chainId (1 for Ethereum, 8453 for Base):

Factory	Returns	Use for
morpho.vaultV2(address, chainId)	MorphoVaultV2	Vault V2 (preferred for new deployments)
morpho.vaultV1(address, chainId)	MorphoVaultV1	MetaMorpho (vault v1)
morpho.marketV1(marketParams, chainId)	MorphoMarketV1	Morpho Blue market

Reads — each entity exposes getData(), plus getMarketData() / getPositionData(user) where applicable. Returns live on-chain state needed to build actions.

Actions — each action returns { buildTx, getRequirements }:

Entity	Actions
MorphoVaultV2	deposit, withdraw, redeem, forceWithdraw, forceRedeem
MorphoVaultV1	deposit, withdraw, redeem, migrateToV2
MorphoMarketV1	supplyCollateral, borrow, repay, withdrawCollateral, supplyCollateralBorrow, repayWithdrawCollateral, plus getReallocationData / getReallocations for PublicAllocator

Canonical write pattern:

1. Construct MorphoClient and the entity (vault or market).
2. Fetch live state: await entity.getData() (vaults) or await market.getMarketData() + await market.getPositionData(user) (markets).
3. Call the action: const { buildTx, getRequirements } = await entity.deposit({ amount, userAddress, accrualVault }).
4. Resolve requirements: const reqs = await getRequirements() — returns ERC-20 approvals, EIP-2612 permits, Permit2 data, and/or morpho.setAuthorization(GA1, true) steps as needed.
5. Sign permits / send approval txs as dictated by the requirements.
6. Build and send: const tx = buildTx(requirementSignatures) → { to, value, data, action } → sign and broadcast.

Notes:

• Slippage — morpho-sdk computes maxSharePrice / minSharePrice bounds from on-chain state automatically. Default tolerance is 3 bps, capped at 10%. Override via the action's slippage option when tighter/looser bounds are needed.
• Borrow health — borrow and supplyCollateralBorrow apply an LLTV buffer automatically using the position snapshot you pass in. Always fetch a fresh positionData immediately before calling borrow actions.
• Native ETH — pass a nativeAmount to deposit/borrow actions for atomic wrap-and-supply in a single transaction.
• Analytics — an optional metadata field on every action tags the transaction for attribution.
• No wagmi wrapper — morpho-sdk is viem-only. In React, construct MorphoClient against the wagmi public client (usePublicClient()) and feed buildTx output into useSendTransaction.

@morpho-org/blue-sdk

Types, entity classes, and constants.

• Market — class with operation methods (.supply(), .borrow(), .repay(), .withdraw()) and conversion methods (.toSupplyAssets(), .toBorrowAssets())
• MarketParams — new MarketParams({ loanToken, collateralToken, oracle, irm, lltv })
• MarketId — branded type identifying a market
• Position — new Position({ supplyShares, borrowShares, collateral })
• VaultV2 — vault v2 entity class (preferred for new integrations)
• Vault — MetaMorpho (vault v1) entity class
• VaultConfig — configuration class for MetaMorpho vaults

@morpho-org/blue-sdk-viem

ABIs, fetch helpers, and viem augmentation.

ABI catalog — import these instead of hand-rolling ABI JSON:

Export	Contract
blueAbi	Morpho Blue singleton
vaultV2Abi	Vault v2 (preferred for new deployments)
vaultV2FactoryAbi	Vault v2 factory
metaMorphoAbi	MetaMorpho / vault v1 (use for existing v1 vaults)
metaMorphoFactoryAbi	MetaMorpho factory / vault v1
erc2612Abi	ERC-2612 permit
permit2Abi	Uniswap Permit2
wstEthAbi	Wrapped stETH
adaptiveCurveIrmAbi	Morpho's adaptive curve IRM
blueOracleAbi	Morpho oracle

Fetch helpers — fetchMarket, fetchVaultV2 (v2) / fetchVault (v1), fetchPosition read on-chain state into SDK entity objects. Use the fetch helper matching the on-chain vault version. Entity methods include market.toSupplyAssets(), vault.toShares(), etc.

@morpho-org/blue-sdk-wagmi

React hooks wrapping the core SDK. Requires wagmi v2.

Hooks: useMarket, useVault, usePosition, useToken, useHolding, useMarkets, useVaults, usePositions, useTokens, useHoldings, useVaultMarketConfig, useVaultMarketConfigs, useVaultUser, useVaultUsers, useMarketParams, plus plural variants.

@morpho-org/simulation-sdk + @morpho-org/simulation-sdk-wagmi

Client-side simulation of Morpho operations. useSimulationState hook provides simulated post-state for UI previews without submitting transactions.

GraphQL API

Endpoint: https://api.morpho.org/graphql

Key queries: vaults (fields: address, name, symbol, asset, state.netApy, state.totalAssets) and markets (fields: uniqueKey, loanAsset, collateralAsset, state.supplyApy, state.borrowApy, state.utilization, lltv).

Filters and Pagination

Filter	Example	Notes
chainId_in	[1], [8453], [1, 8453]	Required — always specify chain
assetSymbol_in	["USDC"]	Filter by asset symbol
address_in	["0x..."]	Filter by vault address
uniqueKey_in	["0x..."]	Filter by market ID
userAddress_in	["0x..."]	Filter positions for a user

Paginate with first and skip. Iterate until items.length < first.

Value Interpretation

Field	Format	Conversion
netApy / supplyApy / borrowApy	Decimal	0.0534 = 5.34%
totalAssets	Raw string	Divide by 10^asset.decimals
lltv	Raw 1e18 string	Divide by 1e18 for percentage

Integration Approaches

• Backend / scripts / bots (viem) — default to MorphoClient(publicClient) from @morpho-org/morpho-sdk. Use @morpho-org/blue-sdk-viem fetch helpers + ABIs directly only for reads across many entities or for actions morpho-sdk doesn't expose.
• Frontend (React + wagmi) — use @morpho-org/blue-sdk-wagmi hooks (useVault, usePosition, etc.) for reactive reads. For writes, construct MorphoClient against usePublicClient(), build the transaction with morpho-sdk, and submit via wagmi's useSendTransaction. There is no @morpho-org/morpho-sdk-wagmi.
• Advanced (curator ops, market creation, liquidations, flashloans, rewards) — morpho-sdk does not cover these. Use @morpho-org/blue-sdk-viem ABIs together with the targeted sub-SDKs: @morpho-org/liquidation-sdk-viem, @morpho-org/liquidity-sdk-viem, or @morpho-org/migration-sdk-viem.

Protocol Mechanics

Dead Deposits (Inflation Attack Protection)

Detailed reference

ERC-4626 vaults are vulnerable to share-price inflation attacks on their first deposit. A dead deposit — minting shares to the burn address 0x000000000000000000000000000000000000dEaD — must be the very first transaction on any new vault or market. Any user deposit before this enables the attack.

Vault V2 — target shares depend on the asset's decimals:

Formula: targetShares = max(1e9, 10^(6 + max(0, 18 - decimals))) — 18-dec assets: 1e9, 8-dec: 1e16, 6-dec: 1e18. Call vault.mint(TARGET_SHARES, 0xdead).

Market V1 — fixed 1e9 shares regardless of decimals. Call morpho.supply(marketParams, 0, 1e9, 0xdead, "").

Vault V1 — 1e9 shares standard; use 1e12 for tokens with fewer than 9 decimals.

Active-cap requirement: When a Vault V2 references underlying markets/vaults, 0xdead must also hold:

• 1e9 supplyShares in each Market V1 with non-zero vault caps
• 1e9 shares in each Vault V1 with non-zero caps or present in withdraw queues

AdaptiveCurveIRM

Detailed reference

Morpho's approved IRM uses a two-pronged mechanism:

1. Curve — instantly adjusts rates when utilization changes (e.g., 90% ↔ 0% scales rate ×4 or ÷4)
2. Adaptive — continuously shifts the target rate over time based on sustained utilization

Utilization	Rate behavior
0%	Halves every ~5 days
90% (target)	Stable
100%	Doubles every ~5 days

Operational warnings: Avoid 100% utilization — rates compound aggressively. Seed markets with initial supply immediately after creation; an empty market at 0% utilization triggers automatic rate decay.

Slippage and Share/Asset Conversion

Detailed reference

The exchange rate between assets and shares can shift between transaction preparation and on-chain execution. With a proper dead deposit this is a UX concern, not a security vulnerability, but integrations should still protect users.

Defensive pattern: When using @morpho-org/morpho-sdk, slippage bounds (maxSharePrice / minSharePrice, default 3 bps, capped at 10%) are computed and applied automatically — no manual preview+tolerance wiring is needed. Only when dropping to blue-sdk-viem / bundler-sdk-viem directly should you hand-roll the pattern: call previewDeposit() to estimate shares, apply a tolerance floor (e.g., 1%), and verify the actual result meets the minimum.

Full withdrawals: Use redeem(), not withdraw() — avoids leaving dust behind.

Vault V2 quirk: maxDeposit, maxMint, maxWithdraw, and maxRedeem always return zero. Do not rely on these for capacity checks.

Bad Debt Tracking

Detailed reference

• V1.0: Realized immediately — share price drops atomically for all suppliers in the affected market. Vulnerable to flash-loan amplification of bad debt realization.
• V1.1+: Tracked via lostAssets field — share price is unaffected until explicit realization. Prevents flash-loan manipulation.

Common Pitfalls

Detailed reference

Pitfall	Consequence	Prevention
Missing dead deposit	Inflation attack / share-price manipulation	Seed shares to 0xdead before any user deposit
withdraw() for full exit	Dust remains in position	Use redeem() for full exits
Oracle risk blindness	Liquidations with stale or manipulated prices	Check oracle type, freshness, and known risks before integrating a market
ERC4626 vault as collateral	Share-price manipulation (Cream-hack style)	Avoid V1.0 vaults as collateral; V1.1+ without bad debt realization are safer
ERC4626 vault as loan asset	Unpredictable liquidation incentives	Do not list any ERC4626 vault as a loan asset
Ignoring vault governance	Owner/curator can reallocate to risky markets	Audit role holders; document trust assumptions to users

Safety Notes

Addresses: Discover via GraphQL API or SDK fetch helpers. Present candidates to the user for confirmation before use. Never hardcode vault, market, or token addresses.

Chain: Always parameterize — accept chain as a function parameter. Never assume Ethereum or Base. Morpho is deployed on both chains at the same singleton address.

Write flow: All write operations follow: query → prepare → simulate → confirm → execute. Simulate transactions before execution to catch reverts early. The server returns unsigned transactions — your app handles signing.

Token decimals: USDC/USDT = 6, WETH/DAI = 18. Read decimals from the API or contract — never assume 18. Use parseUnits(amount, decimals) for conversion.

USDT approval quirk: Must reset allowance to 0 before setting a new value. Implement as a conditional check for USDT or as a general reset-before-set pattern.

DAI permit: Non-standard — use ERC-20 approve() instead of EIP-2612 permit.

Health factor: For borrow operations, validate the health factor after the intended borrow. Prevent proceeding if the position would become unsafe (health factor < 1.0). Warn at ~1.1.

Dead deposits: Any vault or market creation must include the dead deposit as the first transaction. See Protocol Mechanics > Dead Deposits above.

Testing

Detailed reference

• @morpho-org/test — Vitest/Anvil fixtures for Morpho-specific test setup.
• See the testing guide for a full catalog of test cases covering vaults, markets, input validation, health factors, token approvals, signature security, and bad debt. Implementations should include these checks in their test suites.

Best Practices

Prefer @morpho-org/morpho-sdk for user-facing flows: MorphoClient centralizes slippage bounds, approvals / permits / Permit2 / GA1 authorization, LLTV-buffer health checks on borrow, and bundler routing. Only hand-roll these via @morpho-org/blue-sdk-viem + @morpho-org/bundler-sdk-viem when morpho-sdk does not expose the action (curator ops, market creation, liquidations, flashloans, rewards, custom bundler compositions). See SDK Selection above for the full coverage list.

Prefer vault v2 for new deployments: When creating new vaults, prefer vault v2 over MetaMorpho (v1). When interacting with existing vaults, match the ABI to the on-chain contract — vaultV2Abi for v2, metaMorphoAbi for v1. They are not interchangeable.

Prefer Morpho Blue over Morpho Optimizer: The original Morpho Optimizer (Morpho-Aave, Morpho-Compound) is deprecated. Prefer Morpho Blue contracts and SDKs for new integrations.

No Bundler3: Deprecated. Do not reference in new code.

ABIs: Always import from @morpho-org/blue-sdk-viem. Never hand-roll ABI JSON.

Post-Implementation Review

After finishing code or a plan, review it against these Morpho-specific checks before presenting the result. For each, mark CRITICAL (fund loss), WARNING (broken UX), or N/A.

1. SDK Choice — standard user-facing flows (deposit, borrow, repay, withdraw, migrate, supply/withdraw collateral) use @morpho-org/morpho-sdk (MorphoClient) rather than hand-rolled blue-sdk-viem + bundler-sdk-viem + simulation-sdk compositions. CRITICAL if the hand-rolled version skips a safeguard morpho-sdk would have applied (slippage bound, LLTV buffer on borrow, USDT allowance reset, GA1 authorization); WARNING if it is merely redundant re-implementation of covered flows.
2. Dead Deposit Protection — vault/market creation includes dead deposit to 0xdead as the first tx; correct formula per version (reference)
3. Slippage Protection — morpho-sdk handles tolerance automatically; when using lower-level SDKs directly, deposits/withdrawals use preview functions + tolerance check; full exits use redeem() not withdraw(); no reliance on Vault V2 max* functions (reference)
4. IRM Awareness — new markets seeded promptly; no sustained 100% utilization; APY formulas correct (reference)
5. Bad Debt Safety — no V1.0 vault as collateral; no ERC4626 vault as loan asset; dashboards surface lostAssets (reference)
6. Token Approvals — USDT resets allowance to 0 first; DAI uses approve() not permit() (morpho-sdk handles both automatically via its requirements flow; hand-rolled integrations must implement these) (reference)
7. Vault Governance — UI surfaces role holders; trust assumptions documented (reference)
8. General Safety — no hardcoded addresses; chain ID parameterized; decimals read not assumed; write ops simulate before execute; health factor validated; ABIs from @morpho-org/blue-sdk-viem
9. Test Coverage — implementation includes tests for relevant cases from the testing guide; edge cases (dead deposits, USDT approvals, health factor boundaries, full withdrawals via redeem()) are covered