Re7 USDT Morpho VaultPrice

(RE7USDT)

The Re7 USDT Morpho Vault is a decentralized lending product that acts as a passive lending layer on top of the Morpho Blue protocol. Instead of requiring users to manually select individual lending markets, the vault allows depositors to provide USDT, which is then managed by Re7 Labs. As the curator, Re7 Labs allocates the USDT across various isolated markets to optimize yield and risk management on behalf of the users.

RE7USDT is the ticker symbol for the receipt token issued to users upon depositing USDT into the vault. This token represents a depositor's proportional share of the total assets held within the vault, including any accrued interest. As borrowers pay interest on their loans, the value of the RE7USDT token increases relative to USDT, reflecting the earned yield.

The vault's yield is determined by the weighted average of the supply rates across all underlying isolated markets where its USDT is allocated. This yield is derived from the lending interest paid by borrowers rather than the staking yield of the collateral assets. Additionally, some markets may offer extra rewards, such as protocol-specific tokens or points, which are generally passed through to the vault's depositors to enhance overall returns.

Depositors face three primary risks: collateral depeg, oracle failure, and curator risk. A collateral depeg occurs if the assets provided by borrowers lose value so rapidly that liquidations cannot cover the debt, leading to bad debt. Oracle risk involves potential failures in price feeds, while curator risk refers to the reliance on Re7 Labs to accurately vet collateral types and set safe parameters for the lending markets.

Re7 Labs utilizes a Risk Curator model, employing specialized monitoring tools and multisig governance to oversee the vault. To protect users, the curator implements time-locks on strategy changes, typically lasting 24 to 48 hours. This window allows depositors to review any proposed changes to collateral or market allocations and withdraw their funds if they disagree with the updated risk profile or new market strategies.

Withdrawal delays typically occur during periods of 100% utilization. If all the USDT deposited in the vault has been borrowed, there is no idle liquidity available for immediate withdrawal. In this scenario, depositors must wait for borrowers to repay their loans or for the curator to rebalance liquidity from other markets. This is a common operational characteristic of decentralized lending protocols.