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A lending market on Dynamo is a pool dedicated to a single collateral asset and a single loan asset, such as USDC, ETH, BTC, and others. When you supply the loan asset, you earn interest paid by borrowers. When you borrow crypto, you draw from that loan asset pool against collateral you’ve posted. Each market operates independently, so activity in one market does not affect another.

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Market isolation in practice

Dynamo surfaces every active Morpho Blue market in a single, filterable list. Each market is a fully isolated lending pool, one loan asset, one collateral asset, one oracle, and one LLTV (Liquidation Loan-to-Value). Nothing that happens in one market can spill over into another.
This isolation is intentional. It means:
  • Predictable risk — you know exactly what oracle and LLTV governs your position
  • No contagion — a collapse in a high-risk market does not affect your position in a low-risk one
  • Composability — new markets can be permissionlessly created without modifying existing ones

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How interest rates are determined

Rates in every market are driven by the interest rate strategy and utilization rate, the share of supplied assets currently being borrowed.
As more borrowers draw from a market, utilization rises and borrow rates increase automatically to attract more suppliers. When utilization falls, borrow rates drop to encourage more borrowing. Supply APY reflects this balance: suppliers earn the interest borrowers pay.
Check the utilization percentage before supplying. A market running at high utilization pays better supply APY, but it also means less liquidity is immediately available to withdraw.

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Market parameters

Each market is configured with a set of parameters that determine how it behaves. You can inspect these on the market detail page.

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Browsing markets

The Markets page shows all active markets with live data:
  • Supply APY — the annualized yield you earn as you lend crypto
  • Borrow APY — the annualized cost to borrow from as you take out crypto currency loans
  • Utilization % — how much of the supplied liquidity is currently borrowed
  • Available liquidity — the amount you can withdraw or borrow right now

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Verified vs. unverified markets

Dynamo is permissionless, anyone can create a lending market for any asset. Markets go through a verification process that checks oracle reliability, collateral parameters, and contract integrity before being added to the website.
Only interact with verified markets. Unverified markets may use unreliable price feeds or misconfigured parameters that put your funds at risk. Verified markets are clearly labeled in the UI.

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Market isolation

Each market is fully isolated. A bad debt event or an oracle failure in one market does not spread to any other market. Your exposure is limited to the markets you choose to participate in.
Because markets are isolated, your collateral posted in one market cannot be used to borrow from a different market. You must post collateral separately in each market where you want to borrow.