Euler Protocol
Euler v2 is a modular lending protocol where anyone can create custom lending vaults. Unlike monolithic pools (Aave, Compound), Euler uses the Ethereum Vault Connector (EVC) to let independent vaults compose with each other - deposit collateral in one vault, borrow from another. Each vault has its own risk parameters, oracles, and liquidation rules, providing true risk isolation.
Euler v2 Ecosystem Architecture
Users interact through the EVC, which routes operations to independent, risk-isolated vaults. Each vault is an ERC-4626 token with its own parameters.
Euler Vault Kit
Modular lending vaults with the Ethereum Vault Connector - create custom lending markets with pluggable oracles and risk parameters
Risk Architecture
How Euler v2 isolates risk: vault tiers, collateral quality scoring, circuit breakers, and the governor system
Key Metrics
Euler v2 vs Other Lending Protocols
| Feature | Euler v2 | Aave v3 | Compound v3 | Morpho Blue |
|---|---|---|---|---|
| Architecture | Modular vaults + EVC | Shared pools | Single-asset pools | Isolated markets |
| Permissionless Markets | Yes (any vault) | No (governance) | No (governance) | Yes |
| Vault Composability | EVC cross-vault | eMode groups | None | None |
| Sub-Accounts | 256 per address | No | No | No |
| Oracle Flexibility | Per-vault (any oracle) | Chainlink mainly | Chainlink mainly | Per-market |
| Liquidation Model | Dutch auction | Fixed bonus | Fixed bonus | Fixed bonus |
Euler v1 was exploited for $197M in March 2023 (funds were returned). Rather than patching v1, the team built v2 from scratch with a modular, risk-isolated architecture. The EVC and vault-based design means a problem in one vault cannot cascade to others.
Explore Risk Architecture ->