Original Title: Curators Explained
Original Author: @MerlinEgalite
Compiled by: Peggy, BlockBeats
Editor’s Note: As DeFi shifts from high-yield-driven to institutional and infrastructure competition, Morpho is attempting to reshape the organization of on-chain lending through its Vault and Curator mechanisms. From a platform perspective, this article introduces the role of Curators and their non-custodial, programmatic operational logic.
Below is the original text:
What is a Curator?
A Curator is an independent team or entity, not part of Morpho’s official team—responsible for designing, deploying, and managing on-chain Vaults.
From a macro perspective, the Curator’s job is to package diversified portfolios into user-friendly, easily integrable Vault products.
Specifically for Morpho Vaults, these Vaults are essentially portfolios composed of a set of over-collateralized lending positions. This structure allows users to: deposit in one entry point; earn yields with one click; delegate ongoing risk management and portfolio construction to the Curator.
In traditional finance, the closest role to a Vault Curator is an asset manager or fund manager. Both are responsible for strategy formulation and risk management, but there are important fundamental differences: Vault Curators are non-custodial, execution is fully automated through smart contracts and completely transparent, rather than relying on human intermediaries.
In Morpho Vaults, Curators can never take over or custody user funds. What they do is execute predetermined strategies by programmatically configuring the Vault.
Users can freely deposit or withdraw funds at any time, without needing anyone’s approval, and there is no possibility of being manually blocked; ownership and control of assets always remain in the user’s own hands.
Curator’s Business Model
Curators can be compensated through: management fees; performance fees.
The specific fee structure is set by the Curator themselves and can be configured for different Vaults, but must adhere to preset maximum fee caps.
Some Curators opt for lower fees; others charge higher fees based on their historical performance or differentiated strategies. These decisions are entirely up to the Curator and are unrelated to Morpho.
Additionally, Curators can collaborate with distributors (such as fintech companies or platforms) to share fees generated from certain specific deposits between the Curator and the distributor through revenue-sharing arrangements.
Although the Curator’s business model resembles that of traditional asset managers in form, there is one key difference: the operational costs of Vaults are far lower than those of traditional funds or asset management platforms.
Vaults replace the massive back-office systems of traditional asset management with a few hundred lines of free, open-source code. Most processes are automated, everything runs on-chain in real-time, eliminating the need to wait for quarterly reports.
Therefore, Curators are often able to charge lower fees than their traditional finance counterparts while maintaining substantial profit margins.
How to Evaluate a Curator (Non-Exhaustive List)
For institutional entities, the method of evaluating a Curator should be familiar. It is similar to evaluating traditional asset managers, but with one significant advantage: complete transparency.
Vaults are built on public blockchains, and with various dashboard tools, detailed data for any Curator or Vault can be viewed in real-time.
Here are some key evaluation dimensions:
Track Record
What experience do they have in the DeFi space (and in traditional finance where relevant)?
Have they collaborated with well-known companies, fintech firms, or institutions?
How has their strategy performed across different market cycles, especially during stress tests?
How much assets under management (AUM) do they currently manage across all Vaults?
While AUM itself does not guarantee quality, it is often a useful indicator of market trust and product-market fit.
Transparency & Methodology
Do they clearly explain their asset allocation methods and risk control standards?
Have they established an internal risk rating system?
Have they disclosed their response processes for market tightening or extreme events?
How are roles and permissions divided among the various Vaults?
Do they follow strict operational security (OpSec) practices?
Do they offer any form of insurance or risk mitigation mechanisms?
Communications
Before depositing funds, one should pay attention to the Curator’s public channels, such as X (Twitter) and official websites.
Do they maintain proactive communication during both high-yield periods and market turbulence?
Do they regularly update on Vault performance, changes in asset allocation, and risk events?
Conflicts of Interest
Do they clearly disclose actual or potential conflicts of interest?
Do they have financial or governance relationships with certain protocols, investors, or counterparties that could influence allocation decisions?
As in traditional finance, responsible institutions should clearly state the sources of conflicts and how they are managed.
By evaluating across the above dimensions, institutions can select Curators whose strategy style, risk appetite, and disclosure standards align with their own needs, while relying on the strong, immutable systemic guarantees provided by Morpho’s underlying infrastructure.
Note: The above list is not exhaustive. Some content applies to Morpho Vaults and their Curators, but may not necessarily apply to other platforms or Vault systems.
