From ff2f10f5dbe3a06befe0bffe89c82c11129fb918 Mon Sep 17 00:00:00 2001 From: spalen0 Date: Wed, 1 Apr 2026 10:34:23 +0200 Subject: [PATCH 1/4] fix: broken morpho links --- .../products/curating/introduction.md | 12 ++++++------ .../products/curating/morpho-curating.md | 12 ++++++------ 2 files changed, 12 insertions(+), 12 deletions(-) diff --git a/docs/getting-started/products/curating/introduction.md b/docs/getting-started/products/curating/introduction.md index 4acef24be..310ad39b9 100644 --- a/docs/getting-started/products/curating/introduction.md +++ b/docs/getting-started/products/curating/introduction.md @@ -4,7 +4,7 @@ ## Our Origin Story -Yearn Curation started from an internal need to handle risk scores for Yearn strategies that deposit into Morpho Vaults. Each vault has its own curator and each curator has different risk appetites. Morpho Vault code is immutable, but the vault's composition changes. Curators can add and remove markets from vaults, and allocations to markets can change so that the vaults no longer match their previous risk scores. So we need to be able to react and update risk scores dynamically. To handle this flow, we build a monitoring stack for the Morpho Vaults used by Yearn V3 strategies. This risk monitoring captures events and triggers alerts when these vaults are not behaving as expected. You can read about how our monitoring works in the [monitoring section](#monitoring) of this page, and on our [GitHub repository](https://github.com/yearn/monitoring-scripts-py/tree/main/morpho). +Yearn Curation started from an internal need to handle risk scores for Yearn strategies that deposit into Morpho Vaults. Each vault has its own curator and each curator has different risk appetites. Morpho Vault code is immutable, but the vault's composition changes. Curators can add and remove markets from vaults, and allocations to markets can change so that the vaults no longer match their previous risk scores. So we need to be able to react and update risk scores dynamically. To handle this flow, we build a monitoring stack for the Morpho Vaults used by Yearn V3 strategies. This risk monitoring captures events and triggers alerts when these vaults are not behaving as expected. You can read about how our monitoring works in the [monitoring section](#monitoring) of this page, and on our [GitHub repository](https://github.com/yearn/monitoring/tree/main/morpho). With the monitoring stack already built, and the prerequisite knowledge about risk management already in-house, it made sense to take the next step and start curating on Morpho ourselves to make sure our strategies are always in line with our risk appetites. @@ -49,17 +49,17 @@ We don’t just guess what might happen – we build tools to watch it closely. Our monitoring system is designed to track key metrics and potential risks across various DeFi protocols integrated with Yearn. Capabilities include: -- Governance Tracking: Observing governance activities, including scheduled timelock transactions using [Tenderly Alerts](https://docs.tenderly.co/alerts/intro-to-alerts), [multisig queued transactions](https://github.com/yearn/monitoring-scripts-py/blob/main/safe/main.py) on safe, and critical function calls across protocols like [Aave](https://github.com/yearn/monitoring-scripts-py/tree/main/aave), [Compound](https://github.com/yearn/monitoring-scripts-py/tree/main/compound), [Maker](https://github.com/yearn/monitoring-scripts-py/tree/main/maker), [Morpho](https://github.com/yearn/monitoring-scripts-py/tree/main/morpho), [Ethena](https://github.com/yearn/monitoring-scripts-py/tree/main/ethena) and [others](https://github.com/yearn/monitoring-scripts-py/tree/main/README.md). -- Peg Stability: Checking exchange rates for [LSTs/LRTs](https://github.com/yearn/monitoring-scripts-py/tree/main/lrt-pegs) (like stETH, ezETH) and stablecoins in key liquidity pools, alerting on significant depegs. -- Market Risk Metrics: For specific protocols like [Morpho](https://github.com/yearn/monitoring-scripts-py/tree/main/morpho), [Euler](https://github.com/yearn/monitoring-scripts-py/tree/main/euler), monitoring composite vault/market risk levels based on asset allocations and individual risk scores. -- Bad Debt Monitoring: Tracking protocol bad debt levels, often using external data sources like [Risk DAO](https://github.com/Risk-DAO/simulation-results), alerting if [thresholds are breached](https://github.com/yearn/monitoring-scripts-py/blob/main/bad-debt/bad-debt-trigger.py). +- Governance Tracking: Observing governance activities, including scheduled timelock transactions using [Tenderly Alerts](https://docs.tenderly.co/alerts/intro-to-alerts), [multisig queued transactions](https://github.com/yearn/monitoring/blob/main/safe/main.py) on safe, and critical function calls across protocols like [Aave](https://github.com/yearn/monitoring/tree/main/aave), [Compound](https://github.com/yearn/monitoring/tree/main/compound), [Maker](https://github.com/yearn/monitoring/tree/main/maker), [Morpho](https://github.com/yearn/monitoring/tree/main/morpho), [Ethena](https://github.com/yearn/monitoring/tree/main/ethena) and [others](https://github.com/yearn/monitoring/tree/main/README.md). +- Peg Stability: Checking exchange rates for [LSTs/LRTs](https://github.com/yearn/monitoring/tree/main/lrt-pegs) (like stETH, ezETH) and stablecoins in key liquidity pools, alerting on significant depegs. +- Market Risk Metrics: For specific protocols like [Morpho](https://github.com/yearn/monitoring/tree/main/morpho), [Euler](https://github.com/yearn/monitoring/tree/main/euler), monitoring composite vault/market risk levels based on asset allocations and individual risk scores. +- Bad Debt Monitoring: Tracking protocol bad debt levels, often using external data sources like [Risk DAO](https://github.com/Risk-DAO/simulation-results), alerting if [thresholds are breached](https://github.com/yearn/monitoring/blob/main/bad-debt/bad-debt-trigger.py). - Market Utilization: Monitoring asset utilization rates in lending markets and sending alerts when utilization approaches critical levels. - Supply Caps: Calculating supply caps multiple times a day and alerting if the cap is too high and should be lowered. We don't immediately lower the supply cap in Morpho contracts, but we lower it in our internal reallocation configuration. This allows us to keep the vault's allocation below calculated caps and set higher caps if the market gets healthier without waiting for the 3-day timelock delay. If the caps remain high over a long period of time, we will lower the cap in the Morpho contracts to ensure maximum safety. - Collateral Liquidity: Calculating liquidity multiple times a day to verify that collaterals backing risky borrowing positions have enough on-chain liquidity. This assures smooth liquidations for the borrowed asset without slippage, and minimizes the risk that a position becomes unprofitable to liquidate and lead to bad debt in lending vaults. Alerts are primarily delivered via Telegram, triggered by scheduled GitHub Actions running Python scripts or real-time Tenderly alerts based on on-chain events. -For more details, check our [GitHub monitoring repository](https://github.com/yearn/monitoring-scripts-py) and [detailed documentation generated by DeepWiki](https://deepwiki.com/yearn/monitoring-scripts-py/). This is only part of our monitoring stack that we have open sourced. +For more details, check our [GitHub monitoring repository](https://github.com/yearn/monitoring) and [detailed documentation generated by DeepWiki](https://deepwiki.com/yearn/monitoring). This is only part of our monitoring stack that we have open sourced. ### Morpho and other Rewards diff --git a/docs/getting-started/products/curating/morpho-curating.md b/docs/getting-started/products/curating/morpho-curating.md index 70ff682e7..fe4b1020c 100644 --- a/docs/getting-started/products/curating/morpho-curating.md +++ b/docs/getting-started/products/curating/morpho-curating.md @@ -47,17 +47,17 @@ Users can engage with Yearn-curated Morpho Vaults in three ways: ### Yearn Morpho Lender Strategies -To enjoy maximum yield, users can deposit into the Yearn Morpho Lender Strategy. Check out [Yearn Morpho Compounder strategies](https://yearn.fi/v3?types=single&search=morpho%20yearn) and deposit to earn juicy yields. +To enjoy maximum yield, users can deposit into the Yearn Morpho Lender Strategy. Check out [Yearn Morpho Compounder strategies](https://morpho.yearn.space/?search=yearn) and deposit to earn juicy yields. ### Live Morpho Vaults If you prefer depositing directly into the Morpho vaults, we are live on the following chains: -- [Mainnet](https://app.morpho.org/ethereum/earn?curatorAddressesFilter=0xe5e2Baf96198c56380dDD5E992D7d1ADa0e989c0%2C0xFEaE2F855250c36A77b8C68dB07C4dD9711fE36F%2C0x518C21DC88D9780c0A1Be566433c571461A70149%2C0xfd99a19Fcf577Be92fDAB4ef162c1644BB056885) -- [Katana](https://app.morpho.org/katana/earn?curatorAddressesFilter=0xe5e2Baf96198c56380dDD5E992D7d1ADa0e989c0%2C0xFEaE2F855250c36A77b8C68dB07C4dD9711fE36F%2C0x518C21DC88D9780c0A1Be566433c571461A70149%2C0xfd99a19Fcf577Be92fDAB4ef162c1644BB056885) -- [Base](https://app.morpho.org/base/earn?curatorAddressesFilter=0xe5e2Baf96198c56380dDD5E992D7d1ADa0e989c0%2C0xFEaE2F855250c36A77b8C68dB07C4dD9711fE36F%2C0x518C21DC88D9780c0A1Be566433c571461A70149%2C0xfd99a19Fcf577Be92fDAB4ef162c1644BB056885) -- [Arbitrum](https://app.morpho.org/arbitrum/earn?curatorAddressesFilter=0xe5e2Baf96198c56380dDD5E992D7d1ADa0e989c0%2C0xFEaE2F855250c36A77b8C68dB07C4dD9711fE36F%2C0x518C21DC88D9780c0A1Be566433c571461A70149%2C0xfd99a19Fcf577Be92fDAB4ef162c1644BB056885) +- [Mainnet](https://app.morpho.org/vaults?curators=yearn&chains=1) +- [Katana](https://app.morpho.org/vaults?curators=yearn&chains=747474) +- [Base](https://app.morpho.org/vaults?curators=yearn&chains=8453) +- [Arbitrum](https://app.morpho.org/vaults?curators=yearn&chains=42161) ### YFI Maxi -For Yearn lovers and YFI holders, we have a special [Morpho Market YFI/USDC](https://app.morpho.org/ethereum/market/0x973e9dd45799efe8775417bcc420a3ab84a583587b2108985746e2fe201d0c83/yfi-usdc) where users can deposit YFI as collateral and borrow USDC. +For Yearn lovers and YFI holders, we have a special [Morpho Market YFI/USDC](https://app.morpho.org/ethereum/market/0x973e9dd45799efe8775417bcc420a3ab84a583587b2108985746e2fe201d0c83/yfi-usdc) where users can deposit YFI as collateral and borrow USDC. The same [Morpho Market YFI/USDC is available on Base](https://app.morpho.org/base/market/0x973e9dd45799efe8775417bcc420a3ab84a583587b2108985746e2fe201d0c83/yfi-usdc). From c4702ec2ee73351c1d61e88f4855265707bf5705 Mon Sep 17 00:00:00 2001 From: spalen0 Date: Wed, 1 Apr 2026 11:34:33 +0200 Subject: [PATCH 2/4] docs: update curation page --- .../products/curating/introduction.md | 40 ++++++++++++------- 1 file changed, 26 insertions(+), 14 deletions(-) diff --git a/docs/getting-started/products/curating/introduction.md b/docs/getting-started/products/curating/introduction.md index 310ad39b9..ae6f0b609 100644 --- a/docs/getting-started/products/curating/introduction.md +++ b/docs/getting-started/products/curating/introduction.md @@ -8,6 +8,8 @@ Yearn Curation started from an internal need to handle risk scores for Yearn str With the monitoring stack already built, and the prerequisite knowledge about risk management already in-house, it made sense to take the next step and start curating on Morpho ourselves to make sure our strategies are always in line with our risk appetites. +We publish our risk assessments, token exposures, and Morpho market monitoring publicly on our [Yearn Curation Dashboard](https://curation.yearn.fi/). Transparency is a core principle — anyone can review the same risk data we use to make curation decisions. + ## Vault Tiers We sort our vaults into three risk tiers: @@ -22,9 +24,9 @@ This is the most important thing we do. Choosing which markets to support and ho We don’t just guess! We use on-chain data and simulations to calculate how these markets perform. The simulations look at market liquidity, asset liquidity, defined caps, and more. Based on this, we can take a few actions: -- **Adding New Markets**: When we find a good, safe market that fits the vault’s risk level, we can add it in. -- **Tweaking Allocations**: Markets change! We constantly watch them and shift funds around to keep the vault optimized for the best risk-adjusted yield. Our automated systems check this hourly and reallocate if the potential APY boost is worth the gas cost. To avoid extremely high utilization, the optimization always targets a max of 95% utilization. This keeps the system liquid while still maintaining strong yield performance. -- **Setting Supply Caps**: We limit how much of the vault’s total funds can go into any single market. This prevents putting too many eggs in one basket. These caps aren’t static; they’re adjusted based on real-time on-chain liquidity and how close borrowers are to being liquidated. If slippage (the price impact of selling collateral during liquidations) looks high, we will lower the cap for that market. +- **Adding New Markets**: When we find a good, safe market that fits the vault’s risk level, we can add it in. Each market is assigned a risk tier (1–5, where 1 is safest) based on oracle quality and asset liquidity. The vault’s overall risk level determines which tiers are allowed and how much allocation each tier can receive. Before adding a market, we produce a detailed risk assessment report covering audits, centralization risk, funds management, liquidity risk, and operational risk — each scored and weighted to produce a final risk score. All reports are published on our [curation dashboard](https://curation.yearn.fi/). +- **Tweaking Allocations**: Markets change! We run automated optimization hourly that uses constrained mathematical optimization to find the best allocation across all markets. The optimizer maximizes risk-adjusted yield while respecting supply caps, utilization ceilings, risk tier limits, and per-market allocation bounds. A reallocation only executes if the projected APY improvement exceeds a minimum threshold to justify gas costs. No single market can receive more than 95% of the vault’s total assets to allow exit liquidity for users if single market gets stuck with 100% utilization. +- **Setting Supply Caps**: We limit how much of the vault’s total funds can go into any single market. These caps are calculated multiple times a day using real-time on-chain data. The process aggregates liquidity across DEXs (Uniswap V2/V3/V4, Curve, Balancer, Aerodrome, SushiSwap, and more), analyzes borrower positions near liquidation thresholds, and simulates the slippage impact of liquidating risky collateral. If slippage exceeds acceptable levels, caps are automatically tightened — and if slippage is extreme, the cap drops to zero. We don’t immediately lower the supply cap onchain in Morpho contracts, but we lower it in our internal reallocation configuration. This allows us to keep the vault’s allocation below calculated caps and set higher caps if the market recovers without waiting for the timelock delay. If the caps remain elevated over a long period, we will lower the cap in the Morpho contracts to ensure maximum safety. ## Keeping Things Running Smoothly @@ -32,13 +34,14 @@ Once a vault is set up, the job isn’t done. Market conditions, borrowing deman - **Playing it Safe**: We constantly check on-chain liquidity on DEXs for potential liquidation capacity and monitor borrower health on the Morpho market. We evaluate the collateral of risky positions and compare it with available on-chain DEX liquidity to adjust the cap accordingly. We also aim to avoid overly utilized markets to ensure there’s always some breathing room for withdrawals. - **Yield Optimization**: We analyze which markets are offering the best returns for their risk level and shift funds accordingly. Our goal is always the best risk-adjusted yield, not just the highest yield. And we use our models to predict how yield might change based on time market allocation. +- **Emergency Response**: When a protocol we lend into shows signs of distress, our monitoring system can automatically trigger emergency actions. For critical alerts (e.g., a collateral protocol’s reserves dropping dangerously low), the system can zero the supply caps for affected markets and force an immediate reallocation to withdraw funds — all without manual intervention. For high-severity alerts, that require maunally checks, a pull request is created for the team to review before executing. Individual vaults can also be shut down manually if needed, clearing their supply queue and reallocating to idle. Our strategy boils down to deeply understanding and managing risk. We use: -- Frequent Data Checks: Looking at liquidity, volatility, potential slippage, risky positions. -- Automated Optimization: Our tools constantly work to find the best allocations and adjust safety caps. -- Sensible Guardrails: A 72-hour time-lock for major changes gives everyone time to react if needed, and specific roles (Guardian, Reallocator, Owner) ensure actions are taken by the right parties with the right permissions. -- Monitoring: We monitor assets and protocols that we use. From governance decisions to contract upgrades, on-chain liquidity to borrower health on the lending market, and other key risk factors. +- Frequent Data Checks: On-chain liquidity, slippage simulations, risky borrower positions, and utilization rates. +- Automated Optimization: Reallocation runs using constrained mathematical optimization to find the best allocations, plus daily supply cap recalculation. +- Sensible Guardrails: A 72-hour time-lock for major changes gives everyone time to react if needed, and specific roles (Guardian, Reallocator, Owner) ensure actions are taken by the right parties with the right permissions. Safety constraints include a maximum 95% allocation per market, utilization ceilings, gas price limits. +- Monitoring: We monitor multiple DeFi protocols across multiple chains. From governance decisions to contract upgrades, on-chain liquidity to borrower health on the lending market, and other key risk factors. By combining automated optimization with careful, real-time monitoring and a risk-first mindset, we aim to provide curated lending vaults that are both high-performing and aligned with Yearn’s safety standards. This means Yearn users can confidently use these vaults, and lending market users get access to expertly managed options. @@ -46,21 +49,30 @@ By combining automated optimization with careful, real-time monitoring and a ris We don’t just guess what might happen – we build tools to watch it closely. Our monitoring system keeps tabs on important numbers and potential risks across all the DeFi protocols Yearn uses. -Our monitoring system is designed to track key metrics and potential risks across various DeFi protocols integrated with Yearn. +Our monitoring system is designed to track key metrics and potential risks across 20+ DeFi protocols integrated with Yearn, running across multiple chains (Ethereum, Base, Katana, Polygon, Arbitrum, Optimism). Capabilities include: -- Governance Tracking: Observing governance activities, including scheduled timelock transactions using [Tenderly Alerts](https://docs.tenderly.co/alerts/intro-to-alerts), [multisig queued transactions](https://github.com/yearn/monitoring/blob/main/safe/main.py) on safe, and critical function calls across protocols like [Aave](https://github.com/yearn/monitoring/tree/main/aave), [Compound](https://github.com/yearn/monitoring/tree/main/compound), [Maker](https://github.com/yearn/monitoring/tree/main/maker), [Morpho](https://github.com/yearn/monitoring/tree/main/morpho), [Ethena](https://github.com/yearn/monitoring/tree/main/ethena) and [others](https://github.com/yearn/monitoring/tree/main/README.md). -- Peg Stability: Checking exchange rates for [LSTs/LRTs](https://github.com/yearn/monitoring/tree/main/lrt-pegs) (like stETH, ezETH) and stablecoins in key liquidity pools, alerting on significant depegs. -- Market Risk Metrics: For specific protocols like [Morpho](https://github.com/yearn/monitoring/tree/main/morpho), [Euler](https://github.com/yearn/monitoring/tree/main/euler), monitoring composite vault/market risk levels based on asset allocations and individual risk scores. -- Bad Debt Monitoring: Tracking protocol bad debt levels, often using external data sources like [Risk DAO](https://github.com/Risk-DAO/simulation-results), alerting if [thresholds are breached](https://github.com/yearn/monitoring/blob/main/bad-debt/bad-debt-trigger.py). +- Governance Tracking: Observing governance activities, including scheduled timelock transactions using [Tenderly Alerts](https://docs.tenderly.co/alerts/intro-to-alerts), [multisig queued transactions](https://github.com/yearn/monitoring/blob/main/safe/main.py) on Safe, and critical function calls across protocols like [Aave](https://github.com/yearn/monitoring/tree/main/aave), [Compound](https://github.com/yearn/monitoring/tree/main/compound), [Maker](https://github.com/yearn/monitoring/tree/main/maker), [Morpho](https://github.com/yearn/monitoring/tree/main/morpho), [Ethena](https://github.com/yearn/monitoring/tree/main/ethena), [Euler](https://github.com/yearn/monitoring/tree/main/euler), [Fluid](https://github.com/yearn/monitoring/tree/main/fluid), [Pendle](https://github.com/yearn/monitoring/tree/main/pendle), and [others](https://github.com/yearn/monitoring/tree/main/README.md). +- Peg Stability: Checking exchange rates for [LSTs/LRTs](https://github.com/yearn/monitoring/tree/main/lrt-pegs) (like stETH, ezETH, pufETH, rsETH) and stablecoins (USDe, USDS, USD0) in key liquidity pools, alerting on significant depegs. +- Morpho Vault Health: Hourly monitoring of [Morpho vaults](https://github.com/yearn/monitoring/tree/main/morpho) across all chains, tracking bad debt ratios (alerting above 0.5%), utilization rates (alerting above 95%), and composite risk levels calculated as the weighted sum of market risk tiers and allocation percentages. Each market is classified into risk tiers 1–5 based on oracle quality and asset liquidity. - Market Utilization: Monitoring asset utilization rates in lending markets and sending alerts when utilization approaches critical levels. -- Supply Caps: Calculating supply caps multiple times a day and alerting if the cap is too high and should be lowered. We don't immediately lower the supply cap in Morpho contracts, but we lower it in our internal reallocation configuration. This allows us to keep the vault's allocation below calculated caps and set higher caps if the market gets healthier without waiting for the 3-day timelock delay. If the caps remain high over a long period of time, we will lower the cap in the Morpho contracts to ensure maximum safety. -- Collateral Liquidity: Calculating liquidity multiple times a day to verify that collaterals backing risky borrowing positions have enough on-chain liquidity. This assures smooth liquidations for the borrowed asset without slippage, and minimizes the risk that a position becomes unprofitable to liquidate and lead to bad debt in lending vaults. +- Supply Caps: Calculating supply caps multiple times a day based on aggregated DEX liquidity, risky borrower positions, and simulated liquidation slippage. If the calculated cap is lower than the current allocation, alerts are triggered. We don’t immediately lower the supply cap in Morpho contracts, but we lower it in our internal reallocation configuration. This allows us to keep the vault’s allocation below calculated caps and raise caps again without waiting for the timelock delay if the market recovers. If the caps remain elevated over a long period, we lower the cap in the Morpho contracts for maximum safety. +- Collateral Liquidity: Calculating liquidity multiple times a day to verify that collaterals backing risky borrowing positions have enough on-chain liquidity. We aggregate liquidity from 10+ DEX sources (Uniswap V2/V3/V4, Curve, Balancer, Aerodrome, SushiSwap, and more) and simulate actual swap slippage. This assures smooth liquidations for the borrowed asset without excessive slippage, and minimizes the risk that a position becomes unprofitable to liquidate and leads to bad debt in lending vaults. +- Emergency Dispatch: For critical alerts (e.g., a collateral protocol’s reserves dropping dangerously low), the monitoring system can automatically dispatch emergency actions to our reallocation system, zeroing supply caps for affected markets and triggering forced withdrawals. Alerts are primarily delivered via Telegram, triggered by scheduled GitHub Actions running Python scripts or real-time Tenderly alerts based on on-chain events. For more details, check our [GitHub monitoring repository](https://github.com/yearn/monitoring) and [detailed documentation generated by DeepWiki](https://deepwiki.com/yearn/monitoring). This is only part of our monitoring stack that we have open sourced. +### Curation Dashboard + +Our [curation dashboard](https://curation.yearn.fi/) is a public transparency tool where anyone can review the risk data behind our curation decisions. It includes: + +- **Risk Reports**: Detailed assessments for every protocol and asset we interact with. Each report scores five categories — Audits & Historical Track Record, Centralization & Control Risk, Funds Management & Delegation, Liquidity Risk, and Operational Risk — weighted and combined into a final score on a 0–5 scale. Reports include full written analysis, score breakdowns, and links to source data. +- **Token Exposures**: A cross-protocol view showing which tokens are used across multiple protocols, highlighting shared dependencies and cascading risk. Each token's risk tier and usage type (collateral, base asset, yield source) is displayed, making it easy to spot concentration risk. Important to see token user per different protocols in the cases of hacks and other incidents. +- **Morpho Markets**: A live view of the Morpho Blue lending markets we curate, organized by chain (Ethereum, Base, Katana, Polygon). Each market shows its collateral/loan pair, oracle, LLTV, and risk score. +- **Yearn Vault Risk API**: Risk scores for Yearn Vaults are available programmatically at `https://curation.yearn.fi/cdn/vaults/{chainId}.json`, allowing integrators and users to fetch risk data about Yearn Vaults for any chain. + ### Morpho and other Rewards Yearn pioneered the concept of auto-compounding strategies and yield optimization. Morpho markets provide additional rewards in the form of tokens, which can be auto-compounded for more underlying assets. Each deployed Morpho vault will have a corresponding Yearn vault. Deposit and get on with your life. The additional rewards will be compounded for you. From b6d335e702f3932848a0d16afcbcdf6ce5dcf83c Mon Sep 17 00:00:00 2001 From: spalen0 Date: Wed, 1 Apr 2026 15:02:18 +0200 Subject: [PATCH 3/4] docs: curation flow diagrams --- .../products/curating/introduction.md | 86 +++++++++++++++++++ 1 file changed, 86 insertions(+) diff --git a/docs/getting-started/products/curating/introduction.md b/docs/getting-started/products/curating/introduction.md index 8c17f9617..71ae991b6 100644 --- a/docs/getting-started/products/curating/introduction.md +++ b/docs/getting-started/products/curating/introduction.md @@ -18,6 +18,53 @@ We sort our vaults into three risk tiers: - **Yearn OG**: These vaults dip into markets that offer potentially higher yields but come with a bit more risk. They correspond to Yearn’s internal “risk level 2”, with some small allocations to "risk level 3" markets to boost yield with enhanced monitoring. - **Yearn Degen**: These vaults are for those comfortable with higher risk for potentially even higher yields. They correspond to Yearn’s internal “risk level 3” and above. +## Curation Overview + +```mermaid +graph TB + subgraph Monitoring["Monitoring System"] + GOV[Governance Tracking] + PEG[Peg Stability] + HEALTH[Vault Health] + LIQ[Collateral Liquidity] + PRICE[Token Price] + end + + subgraph Automation["Reallocation Automation"] + CAPS[Supply Cap Calculator] + OPT[APY Optimizer] + REALLOC[Reallocator] + end + + subgraph Data["Data Sources"] + RPC[Onchain RPC] + DEX[DEX Liquidity
Uniswap, Curve, Aerodrome, SushiSwap, ...] + MORPHOAPI[Morpho API] + TEND[Tenderly] + end + + VAULTS[Morpho Vaults] + + Data --> Monitoring + Data --> Automation + + GOV -->|Alerts| TG[Telegram Alerts] + PEG -->|Alerts| TG + HEALTH -->|Alerts| TG + LIQ -->|Alerts| TG + PRICE -->|Alerts| TG + HEALTH -->|Critical| EMRG[Emergency Dispatch] + EMRG -->|Zero Caps| CAPS + EMRG -->|Force Withdraw| REALLOC + + DEX --> CAPS + CAPS -->|Cap Limits| OPT + OPT -->|Optimal Allocation| REALLOC + REALLOC -->|Transactions| VAULTS + + DASH[curation.yearn.fi] -.->|Public Dashboard| Monitoring +``` + ## How We Decide Where to Deploy Funds This is the most important thing we do. Choosing which markets to support and how much to send to each directly impacts the vault’s risk and its APY. @@ -28,6 +75,26 @@ We don’t just guess! We use on-chain data and simulations to calculate how the - **Tweaking Allocations**: Markets change! We run automated optimization hourly that uses constrained mathematical optimization to find the best allocation across all markets. The optimizer maximizes risk-adjusted yield while respecting supply caps, utilization ceilings, risk tier limits, and per-market allocation bounds. A reallocation only executes if the projected APY improvement exceeds a minimum threshold to justify gas costs. No single market can receive more than 95% of the vault’s total assets to allow exit liquidity for users if single market gets stuck with 100% utilization. - **Setting Supply Caps**: We limit how much of the vault’s total funds can go into any single market. These caps are calculated multiple times a day using real-time on-chain data. The process aggregates liquidity across DEXs (Uniswap V2/V3/V4, Curve, Balancer, Aerodrome, SushiSwap, and more), analyzes borrower positions near liquidation thresholds, and simulates the slippage impact of liquidating risky collateral. If slippage exceeds acceptable levels, caps are automatically tightened — and if slippage is extreme, the cap drops to zero. We don’t immediately lower the supply cap onchain in Morpho contracts, but we lower it in our internal reallocation configuration. This allows us to keep the vault’s allocation below calculated caps and set higher caps if the market recovers without waiting for the timelock delay. If the caps remain elevated over a long period, we will lower the cap in the Morpho contracts to ensure maximum safety. +### Supply Cap Calculation + +```mermaid +graph LR + subgraph Inputs + DEX[Aggregate DEX
Liquidity] + RISKY[Risky Borrower
Positions] + end + + DEX --> BASE[Base Cap] + RISKY -->|Simulate
Liquidation| SLIP{Slippage
Check} + SLIP -->|Low Slippage| KEEP[Keep Base Cap] + SLIP -->|High Slippage| REDUCE[Reduce Cap] + SLIP -->|Extreme Slippage| ZERO[Cap = 0] + KEEP --> FINAL[Final Supply Cap] + REDUCE --> FINAL + ZERO --> FINAL + FINAL -->|Update| CONFIG[Reallocation Config] +``` + ## Keeping Things Running Smoothly Once a vault is set up, the job isn’t done. Market conditions, borrowing demand, and risks can change fast, so we’re always monitoring and ready to make adjustments. @@ -36,6 +103,25 @@ Once a vault is set up, the job isn’t done. Market conditions, borrowing deman - **Yield Optimization**: We analyze which markets are offering the best returns for their risk level and shift funds accordingly. Our goal is always the best risk-adjusted yield, not just the highest yield. And we use our models to predict how yield might change based on time market allocation. - **Emergency Response**: When a protocol we lend into shows signs of distress, our monitoring system can automatically trigger emergency actions. For critical alerts (e.g., a collateral protocol’s reserves dropping dangerously low), the system can zero the supply caps for affected markets and force an immediate reallocation to withdraw funds — all without manual intervention. For high-severity alerts, that require maunally checks, a pull request is created for the team to review before executing. Individual vaults can also be shut down manually if needed, clearing their supply queue and reallocating to idle. +### Emergency Response Flow + +```mermaid +graph LR + MON[Monitoring
System] -->|Protocol
Alert| SEV{Severity} + + SEV -->|CRITICAL| AUTO[Auto Execute] + AUTO --> ZCAP[Zero Supply Caps] + ZCAP --> FORCE[Force Reallocation
to Withdraw] + + SEV -->|HIGH| PR[Create PR
for Review] + PR -->|Team
Approves| MERGE[Merge] + MERGE --> EXEC[Execute
Reallocation] + + SEV -->|Manual| EXIT[Emergency Exit] + EXIT --> CLEAR[Clear Supply Queue] + CLEAR --> IDLE[Reallocate to Idle] +``` + Our strategy boils down to deeply understanding and managing risk. We use: - Frequent Data Checks: On-chain liquidity, slippage simulations, risky borrower positions, and utilization rates. From 4e6829b5a6c5c84bbf720ade6baa6479c543dee0 Mon Sep 17 00:00:00 2001 From: spalen0 Date: Wed, 1 Apr 2026 15:19:47 +0200 Subject: [PATCH 4/4] docs: curation flow diagram update --- .../products/curating/introduction.md | 29 +++++++++---------- 1 file changed, 14 insertions(+), 15 deletions(-) diff --git a/docs/getting-started/products/curating/introduction.md b/docs/getting-started/products/curating/introduction.md index 71ae991b6..c5190f913 100644 --- a/docs/getting-started/products/curating/introduction.md +++ b/docs/getting-started/products/curating/introduction.md @@ -22,6 +22,13 @@ We sort our vaults into three risk tiers: ```mermaid graph TB + subgraph Data["Data Sources"] + RPC[Onchain RPC] + TEND[Tenderly] + MORPHOAPI[Morpho API] + DEX[DEX Liquidity
Uniswap, Curve, Aerodrome, SushiSwap...] + end + subgraph Monitoring["Monitoring System"] GOV[Governance Tracking] PEG[Peg Stability] @@ -36,28 +43,20 @@ graph TB REALLOC[Reallocator] end - subgraph Data["Data Sources"] - RPC[Onchain RPC] - DEX[DEX Liquidity
Uniswap, Curve, Aerodrome, SushiSwap, ...] - MORPHOAPI[Morpho API] - TEND[Tenderly] - end - VAULTS[Morpho Vaults] Data --> Monitoring Data --> Automation - GOV -->|Alerts| TG[Telegram Alerts] - PEG -->|Alerts| TG - HEALTH -->|Alerts| TG - LIQ -->|Alerts| TG - PRICE -->|Alerts| TG - HEALTH -->|Critical| EMRG[Emergency Dispatch] - EMRG -->|Zero Caps| CAPS + GOV --> TG[Telegram Alerts] + PEG --> TG + HEALTH --> TG + LIQ --> TG + PRICE --> TG + Monitoring -->|Critical/High| EMRG[Emergency Dispatch] + EMRG --> CAPS EMRG -->|Force Withdraw| REALLOC - DEX --> CAPS CAPS -->|Cap Limits| OPT OPT -->|Optimal Allocation| REALLOC REALLOC -->|Transactions| VAULTS