Skip to main content
Dynamo Vaults are the Dynamo SubDAO’s own MetaMorpho vaults, built on top of Morpho’s immutable smart contracts. They are designed around a single principle: the people whose capital is in the vault should decide how it is managed. Unlike vaults run by anonymous or opaque risk curators, every parameter that matters, which markets the vault can use, how capital is allocated between them, and how fees are set, is decided by the Dynamo DAO through on-chain governance.

​
The problem with most curated vaults

Most MetaMorpho vaults on the market today are managed by professional risk curators. While many are reputable, they share a few structural problems:
  • Opaque methodology. Risk frameworks, allocation logic, and rebalancing decisions are usually not disclosed in detail. Depositors trust a black box.
  • No community input. Decisions about which markets to allocate to, how much, and when to rotate are made unilaterally by the curator.
  • No real community. Most curators don’t have an active community of depositors with a voice, just a customer base.
  • Misaligned incentives. Curator fees scale with TVL and yield, not with risk taken on by depositors.
Dynamo Vaults are built to fix all of this.

​
How Dynamo Vaults are different

​
Community-run by the DAO

Dynamo Vaults are not managed by a single curator behind closed doors. Every Dynamo Vault is operated by the Dynamo DAO, the same community that holds the DYNAMO token and steers the SubDAO’s voice in Morpho governance. The DAO decides:
  • Which Morpho markets each vault is allowed to allocate to (its whitelist)
  • The allocation methodology, how capital is distributed across whitelisted markets
  • When and how to update the whitelist or rebalance methodology
  • Vault-level parameters such as fees and risk thresholds
All of this happens through standard DAO process: forum discussion, proposal, and on-chain vote. See Proposals and Voting for the full lifecycle.

​
Per-vault whitelisted markets

Each Dynamo Vault has its own whitelist of Morpho markets, approved by DAO vote. The vault can only allocate capital to markets on that list, nothing else.
  • Whitelists are set per vault, not globally, so a USDC vault and a WETH vault can have completely different risk profiles.
  • Adding or removing a market from a whitelist requires a governance vote.
  • Whitelists are visible on-chain and surfaced in the Dynamo UI, so depositors can audit exactly which markets their capital can reach.
For the full whitelist process and current per-chain market lists, see Whitelisted Markets.

​
Transparent allocation methodology

The methodology by which a Dynamo Vault allocates between its whitelisted markets is also published and governed.
  • The methodology is documented and version-controlled.
  • Material changes to the methodology require a governance vote.
  • Depositors can read exactly how their capital is being deployed before they deposit, not just which markets, but why the vault weights them the way it does.
This turns the vault from a black box into a transparent, auditable strategy.

​
Trust through transparency

The combination of community-set whitelists and a published methodology creates a vault where:
  • Depositors know what they’re getting into before they click deposit.
  • The DAO and the vault are aligned with the community’s actual needs, not a curator’s business model and fee-seeking.
  • Governance changes are forecastable, they happen on-chain, in public, with time to react.
This is what we mean when we say Dynamo Vaults are community-aligned: the people taking the risk are the same people setting the rules.

​
Fees: 0% performance, 0% management at launch

Most MetaMorpho vaults charge a performance and/or management fee that flows to the curator. Dynamo Vaults start with 0% performance fee and 0% management fee.
  • 0% performance fee — every basis point of yield earned by the vault goes back to depositors.
  • 0% management fee — no continuous AUM drag.
  • Any future fee changes would require a governance vote and would be transparent and communicated in advance.
Because Dynamo Vaults launch at 0/0 fees, the net APY shown in the Dynamo app is the gross APY, there is no fee deduction at the vault level for now.
When fees are eventually turned on by the DAO, they would route to the DYNAMO token treasury and feed into the real-yield distribution to locked DYNAMO holders, reinforcing the loop between depositors, stakeholders, and the protocol.

​
What stays the same as any MetaMorpho vault

Dynamo Vaults inherit all the properties of the underlying MetaMorpho standard:
  • Non-custodial — funds are held by the vault smart contract, never by Dynamo or any individual.
  • On-chain transparency — current allocations and share value are publicly visible.
  • No lock-up — withdraw at any time, subject to liquidity in the underlying markets.
  • Audited contracts — same MetaMorpho contracts used across the Morpho ecosystem.
Deposits, withdrawals, share accounting, and rebalancing all work exactly as described in the Vaults concept page.

​
How the loop closes

Dynamo Vaults are the engine of the Dynamo economic loop:
  1. Depositors supply assets into Dynamo Vaults.
  2. Vaults allocate across DAO-whitelisted Morpho markets and earn interest from borrowers.
  3. Yield flows back to depositors.
  4. As fees are eventually enabled by the DAO, a share of vault revenue flows to locked DYNAMO holders as real yield.
  5. Those stakeholders, in turn, govern the whitelists, methodology, and fees of the vaults, closing the loop.