Morpho Governance

Authorize incentives distribution for activity on Arc with an initial monthly budget of $50,000 based on a one month TWAP price for the MORPHO token, governed under the Optimistic Rewards Framework.

This proposal asks the Morpho DAO to approve the addition of Spearbit as a trusted signer on the DAO multisig and to increase the multisig signing threshold to 6-of-10 on Ethereum. The objective is to strengthen the DAO’s operational security by adding a professional, independent signing party with dedicated secure signing procedures, while preserving the DAO’s ability to execute routine governance and operational transactions. If approved, the DAO would: 1. Add Spearbit as an additional signer to the DAO multisig. 2. Increase the multisig threshold to 6-of-10. 3. Fund Spearbit’s trusted signer services from the DAO fund at an annual cost of $33,000, with additional fees for: Standard off-cycle transaction fee: $650/hour, with a minimum 60-minute increment. Urgent approvals within 72 hours: 2x the standard fee. Urgent approvals within 24 hours: 2.5x the standard fee.

Allocate $50,000 worth of MORPHO, measured by a 60-day TWAP prior to the date of proposal approval, for Feather to take over the current Morpho mini app on World.

Summary The Morpho Association (the “Association”) is requesting from the MORPHO token-holding community (the “DAO”) an allocation of a financial grant of 150M MORPHO, to support the Association’s mission to develop and promote the Morpho network over a multi year program (2026-2030). Should the Association cease its activities before the end of this period, it undertakes to repay to the DAO any unspent MORPHO. Motivation The Association, acting as the primary independent contributor to the Morpho ecosystem, maintains a multi-year support program to fund fundamental work to benefit the Morpho network, its users, and public goods for the entire DeFi ecosystem at large. The Morpho Association is free to use the grant and develop its roadmap independently to serve the best interests of the Morpho network. The program is structured around, but not limited to, the following actions aimed at elevating Morpho to a leading open global financial infrastructure: 1. Technological Innovation and Protocol Resilience: Fundamental research and development (protocols, interfaces, security, etc.) in the interest of the Morpho network. 2. Ecosystem Growth and Awareness: Initiatives to raise awareness of decentralized finance and the Morpho protocol, and coordination of actions benefitting the DeFi ecosystem. 3. Institutional Expansion and Strategic Partnerships: Protocol integration and strategic partnerships to foster network growth. Allocation conditions The transfer will be made from the address 0xcba28b38103307ec8da98377fff9816c164f9afa following validation by the multisig executing the DAO’s decision to the address 0x6ABfd6139c7C3CC270ee2Ce132E309F59cAaF6a2 held by the Association. As a result of the above, the grant will be fully and definitively acquired at the end of the period covered by this funding.

Authorize $172k in MORPHO incentives for the Tempo instance of the Morpho protocol, based on a 60 day TWAP prior to the approval of this MIP.

Ratify the previously authorized 2025 Morpho contributor grants distribution.

Authorize a budget of $35k MORPHO for a grant to support a replacement for the Morpho Lite app for two additional chains.

Amend the optimistic rewards framework to account for external tokens grants.

List MorphoMarketV1Adapter in Morpho’s Registry.

Authorize a budget of $54k MORPHO for a grant to support a replacement for the Morpho Lite app.

Introduce a dedicated incentive campaign to accelerate migration from Vault V1 to Vault V2, governed under the Optimistic Rewards Framework.

Authorize a one-off payment of 1,239,393.94 MORPHO so Spark receives the full grant it would have earned in the Morpho Olympics had the eligibility change under MIP-119 applied from the start of the measurement period. Spark became eligible under the updated policy, but the Olympics budget for that window was already exhausted, so its grant was prorated.

Authorize migration of the MORPHO token a new set of LayerZero adaptors with properly configured rate limiting functionality, and authorize the Morpho Association to set current rate limits in response to observed volume.

Fully deprecate the Aave v3 Optimizer, rendering all outstanding borrow positions (approximately $230k) liquidatable and ensuring all lenders can withdraw. Liquidation losses triggered by the deprecation to be reimbursed by the Morpho Association for users who reach out.

Fully deprecate the Aave v2 and Compound v2 optimizer instances.

Adjust AMO rules to apply the same standard MORPHO reward rate to any depositor that deposits any asset eligible under MIP 102 and MIP 109. This means that an asset like USDC will earn rewards even if deposited by a DAO like Spark, while AMO exclusions will remain in place for endogenously mintable assets like DAI or USDS.

Deploy the MORPHO token on HyperEVM using LayerZero, and authorize an initial incentives budget of 100k MORPHO.

Authorize up to 400K MORPHO tokens for further rewards on Arbitrum.

Authorize up to 135k MORPHO for incentives on Unichain.

To support lending supply growth as the Coinbase borrow integration scales, authorize 50% of the standard MORPHO reward rate for Spark USDC deposits in the markets integrated by Coinbase on total deposits up to $1B.

Authorize up to 135k MORPHO tokens for distribution on Arbitrum, under a flexible framework for an initial four week period and governed by the Optimistic Rewards Framework thereafter.

With Morpho now deployed on Arbitrum, we need to make the Morpho token available on this chain. To achieve this, we propose the following: Use LayerZero as the cross-chain messaging infrastructure; Use a lock/release pattern on Ethereum (L1) and a mint/burn pattern on Arbitrum; Use an upgradable ERC20 Morpho token; Assign management roles (admin for ERC20 upgrades, ability to grant mint & burn permissions, adapter configuration) to the Morpho DAO. Note: Mint & burn permissions will be granted to the MintAndBurnAdapter This proposal represents the first operational step in a broader multichain vision for Morpho token bridging, one that may eventually standardize LayerZero as Morpho’s cross-chain bridge infrastructure. As this proposal is focused exclusively on Arbitrum, it avoids any changes to the current Morpho token deployments on Ethereum, Katana, or Base.

The Morpho Association proposes to allocate 200,000 OP tokens from the Optimism Council Grant Cycle 33 to incentivize USDC growth on Base, targeting an additional $5M TVL increase to satisfy the grant criteria.

Switch MORPHO token rewards distribution on Ethereum and Base to use the Merkl stack in order to accomplish the following objectives: 1. Allow MORPHO rewards to more easily scale to support new chains 2. Reduce rewards claiming latency 3. Streamline integration of external rewards programs into the Morpho UI 4. Free up technical resources to focus on Morpho's primary objective of building the best onchain lending and borrowing infrastructure.

Authorize a grant of $78,000 in $MORPHO based on a 7 day TWAP prior to the date of proposal passing to Aragon for work developing a trustless guardian governance module for use with Morpho v2 vaults.