Morpho's $175M raise shows where crypto VC money is flowing

Morpho’s recent $175 million raise reflects growing investor bets on onchain credit infrastructure as stablecoin adoption expands.

Investors are increasingly backing stablecoin and credit infrastructure rather than decentralized finance (DeFi) lending alone, with Morpho Labs' latest funding round drawing attention to onchain credit markets, according to Spark CEO Sam MacPherson.

Morpho announced Tuesday that it raised $175 million in a round led by Paradigm, a16z crypto and Ribbit Capital. While Morpho is widely known as a DeFi lending protocol, the company said that it aims to become a credit infrastructure layer for banks, asset managers and fintechs.

Onchain credit markets allow users and institutions to borrow, lend and deploy capital using blockchain-based assets. Investors are betting the sector will grow alongside stablecoins and other tokenized financial products.

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