# Morpho Active loans Methodology

## 1. Overview

Active loans measures the total value of loan assets currently outstanding to borrowers across all Morpho products. It represents the portion of deposited liquidity on which borrowers pay interest, making it a direct indicator of Morpho's lending scale and revenue-generating capacity. Three product lines are covered: Morpho Blue (a permissionless isolated lending protocol), Morpho Midnight (a fixed-term lending product), and Morpho Optimizers (a peer-to-peer interest rate optimizer built on top of Aave V2, Aave V3, and Compound). Balances are denominated in native loan assets and converted to USD using end-of-day prices.

## 2. Data sources

- **Blockchain events**: `Borrow`, `Repay`, `Liquidate`, and `AccrueInterest` events from `Morpho Blue` contracts (Morpho Blue, covering Ethereum, Arbitrum, Base, Polygon, and 15 other chains); `Take`, `Repay`, and `Liquidate` events from `Midnight` contracts (Morpho Midnight, covering Arc, Base, Ethereum, Robinhood Chain, and Tempo); `Mint` and `Burn` events from `VToken` contracts and `ReserveDataUpdated` events from `LendingPool` contracts; `P2PTotalsUpdated` and `IndexesUpdated` events from `AaveV3Morpho` contracts; `P2PAmountsUpdated`, `Borrowed`, `Repaid`, and `BorrowerPositionUpdated` events from `EntryPositionsManager`, `ExitPositionsManager`, and `PositionsManager` contracts; and `P2PIndexesUpdated` events from `AaveInterestRatesManager` and `InterestRatesManager` contracts (all Morpho Optimizers data is Ethereum only)
- **Protocol exclusion feed**: Market-level and asset-level exclusion windows published by Morpho, supplemented by a hand-curated denylist of exploited and bad-debt markets (Morpho Blue only)
- **External data**: End-of-day price feeds for loan assets

## 3. Step-by-step calculation

### Component A: Morpho Blue borrow balance

- **Purpose**: Calculate the market-level outstanding debt per lending market across 19 chains
- **Logic**: `Borrow` events from `Morpho Blue` contracts contribute `assets` to the market borrow balance. `Repay` events subtract `assets`. `Liquidate` events subtract `repaidAssets` plus `badDebtAssets`, covering both normally repaid debt and socialized bad debt. `AccrueInterest` events add `interest` to both the borrow and supply balances, capturing compound interest accrual between user interactions. A running cumulative sum is maintained per market and chain, ordered by block number and log index. Markets and assets appearing on Morpho's exclusion feed are dropped for the duration of their exclusion window (defined by `effective_from` and `effective_to` dates); hand-listed markets are excluded across all dates. The last state before each day boundary is taken as the closing balance for that day.
- **Key fields**: `assets` from borrow and repay events; `repaidAssets`, `badDebtAssets` from liquidation events; `interest` from accrued interest events

### Component B: Morpho Midnight borrowed balance

- **Purpose**: Calculate the market-level outstanding debt on Morpho Midnight across Arc, Base, Ethereum, Robinhood Chain, and Tempo
- **Logic**: `Take` events from `Midnight` contracts contribute `totalUnitsDelta` to the borrowed balance, capturing the net change in aggregate debt when a loan is matched between a lender and borrower. `Repay` events reduce the balance by `units`. `Liquidate` events reduce it by `repaidUnits` plus `badDebt`. Daily deltas are summed per market, chain, and loan asset, then accumulated as a running cumulative balance across days.
- **Key fields**: `totalUnitsDelta` from take events; `units` from repayment events; `repaidUnits`, `badDebt` from liquidation events

### Component C: Morpho Optimizers peer-to-peer borrowing

- **Purpose**: Calculate the outstanding peer-to-peer loan balance matched through Morpho Optimizers on Ethereum for Aave V3, Aave V2, and Compound markets
- **Logic**: Scaled P2P loan amount snapshots are extracted from `P2PTotalsUpdated` events on `AaveV3Morpho` contracts (Aave V3) and `P2PAmountsUpdated` events on `EntryPositionsManager` contracts (Aave V2) and `PositionsManager` contracts (Compound). Each snapshot's scaled amount is multiplied by the p2p borrow index at the same block, sourced from `IndexesUpdated` events on `AaveV3Morpho` contracts and `P2PIndexesUpdated` events on `AaveInterestRatesManager` and `InterestRatesManager` contracts, taking the last index update within each block. A block-weighted average is then computed per market per day, weighting each snapshot by the number of blocks until the next snapshot to produce a time-weighted daily outstanding balance.
- **Key fields**: `scaledTotalBorrowP2P` (Aave V3), `p2pBorrowAmount` (Aave V2 and Compound); `p2pBorrowIndex` from index update events

### Component D: Morpho Optimizers pool-side borrowing (Aave V2 and Compound)

- **Purpose**: Calculate the outstanding pool-routed loan balance within Morpho Optimizers on Ethereum for Aave V2 and Compound markets
- **Logic**: Per-user pool balance snapshots are captured from `Borrowed`, `Repaid`, and `BorrowerPositionUpdated` events on `EntryPositionsManager`, `ExitPositionsManager`, and `PositionsManager` contracts. Each snapshot's `balanceOnPool` is multiplied by the pool borrow index from the last index update event within the same block. Balances are normalized by decimal precision, then a block-weighted average is computed per user per market per day. User-level daily averages are summed across all borrowers to produce the total market-level outstanding pool borrow balance.
- **Key fields**: `balanceOnPool` from position events; `poolBorrowIndex` from index update events

### Component E: Morpho Optimizers pool-side borrowing (Aave V3)

- **Purpose**: Calculate the outstanding variable debt balance held by the Morpho Optimizer contract in Aave V3 on Ethereum
- **Logic**: `Mint` events from `VToken` contracts, filtered to the Morpho Optimizer contract address as the `onBehalfOf` recipient, increase the scaled principal balance; `Burn` events decrease it. For each mint, the new scaled principal contribution is derived by subtracting `balanceIncrease` (accrued interest on the existing position) from `value` (total debt minted) and dividing by the variable borrow index at that event. For burns, the retired scaled principal is computed by adding `balanceIncrease` to `value` and dividing by the index. The current actual balance is obtained by multiplying the running scaled principal by the variable borrow index sourced from `ReserveDataUpdated` events on Aave V3 `LendingPool` contracts, using the last index per market per day.
- **Key fields**: `value`, `balanceIncrease`, `index` from `VToken` mint and burn events; `variableBorrowIndex` from `LendingPool` reserve data update events

### Component F: Decimal normalization and USD conversion

- **Purpose**: Normalize raw balances and convert to USD for cross-asset comparability
- **Logic**: All balances across all three products are normalized by each loan asset's decimal precision. Normalized amounts are multiplied by end-of-day asset prices. Missing days are forward-filled using the last available balance; remaining gaps after forward-fill are zero-filled. Daily granularity is applied with UTC day boundaries.

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Value of loans currently outstanding to borrowers.

Active loans

Morpho

Lenders can earn on Morpho using Morpho Vaults, noncustodial simple to use lending vaults that optimize yields for depositors. Borrowers can borrow any assets directly from Morpho Markets. Developers and businesses can use different parts of Morpho’s permissionless infrastructure to build any custom use case or application.

Morpho is an open, efficient, and resilient platform that allows anyone to earn yield and borrow assets. At the same time, developers or businesses can create markets, curate vaults, and build a range of applications on its flexible, immutable infrastructure.

MORPHO tokenholders own and govern the protocol. They currently do not take a cut of the interest and third-party token incentives earned by lenders (revenue). Morpho's investors include a16z, Coinbase Ventures, Semantic Ventures, etc.

Morpho MORPHO

Active loans

Active loans

Competitive landscape

Chain breakdown