Morpho Raises $175M, Largest DeFi Round Ever
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- Morpho raised $175 million in a round co-founder Merlin Egalite called "the largest raise in DeFi history," with the protocol's total value locked and active loans climbing sharply since late 2024 per DeFiLlama data.
- Coinbase used Morpho smart contracts to originate more than $2.17 billion in corporate USDC loans, according to research firm Sentora, which cited this as evidence Morpho functions as institutional lending infrastructure rather than purely retail DeFi.
- Sentora reported that exchanges, custodians, and asset managers are actively evaluating blockchain-based lending systems to power credit products, with protocols competing to become the underlying infrastructure for business-to-business integrations.
- Morpho plans to measure the round's success over the next 12 to 18 months by expanding integrations with banks, asset managers, and large platforms and rolling out features from traditional credit markets, Egalite told Cointelegraph.
- Crypto venture funding for Series C and later-stage rounds surged 1,020% year over year and 320% quarter over quarter in Q1 2026, accounting for 28.4% of venture capital across just nine deals, according to CryptoRank.
- Seed and pre-seed crypto funding fell 38.1% year over year to just 5.2% of total capital in Q1 2026, underscoring a sharp concentration of capital into a small group of established infrastructure projects.
Why it matters: Coinbase originating $2.17 billion in corporate USDC loans through Morpho smart contracts shows DeFi lending is operating at institutional scale, not just retail crypto. The 1,020% YoY surge in late-stage crypto funding concentrated into nine deals — paired with seed funding dropping 38.1% — means early-stage crypto startups face a dramatically narrower window of available capital.
