Morpho, a decentralized lending protocol running on Ethereum, HyperEVM and other blockchains currently holding $6.6 billion in total value locked, has raised $175 million in a funding round led by Paradigm, Ribbit Capital and Andreessen Horowitz’s digital assets arm, a16z crypto – valuing the protocol at up to $2 billion and positioning it for a possible public debut as its founders aim to mainstream most traditional Wall Street institutions in DeFi, according to Fortune Report published on June 9.
Related reading
The round also attracted participation from Apollo Funds, Circle’s venture capital unit, and VanEck, a coalition of backers that simultaneously spans crypto-native venture capital, traditional asset management, and institutional finance. The investment was structured in cryptocurrency and valued at the average monthly price of the token, with the exact cost varying depending on when participants contributed, according to Fortune’s report on co-founder Paul Frambot’s account.
ETH's price trends to the downside on the daily chart. Source: ETHUSD on Tradingview
The 25-year-old takes on TradFi
Frambot, who is 25 and founded Morpho at age 20 alongside three other French co-founders – Merlin Egalite, Julien Thomas and Mathis Gontier Delaunay – described the fundraising with characteristic frankness in his conversation with Fortune. “I think TradFi is going to have to wear shorts,” he told the publication – a reference to the cultural divide between the cryptocurrency developer community and the suit institutions he is now actively courting.
Its argument to these institutions is based on performance. Morpho allows any user to create their own blockchain-based lending marketplaces with customizable risk settings – allowing anyone to create their own version of Aave, the legacy DeFi lender that currently holds nearly $12.5 billion in TVL, according to DeFiLlama data cited by Fortune. Morpho’s $6.6 billion clearly positions it as the second-largest player in the decentralized lending space, a gap that narrowed significantly after Aave’s significant exposure in a $290 million hack of other crypto protocols in April 2026, according to Fortune.
Ethereum and Crypto DeFi: the institutions already inside
Morpho’s existing user base indicates that institutional crossover is already underway. Coinbase, Kraken, Anchorage Digital and Galaxy Digital all use Morpho’s infrastructure, according to Fortune reports. Guy Wuollet, general partner at a16z crypto, described Fortune’s moment as one where traditional finance professionals may need casual Fridays while DeFi builders dress very scantily — a convergence he sees as the natural direction of an industry operating increasingly in sync with institutional capital.
Frambot himself recently attended an event at the New York Stock Exchange and wore pants. This development marks a pivotal moment for the nascent sector’s relationship with traditional venture capital and traditional finance.
Related reading
A $175 million raise from three of the most prominent names in crypto, Ethereum and conventional investing – targeting the same Wall Street institutions that have spent two years cautiously circling DeFi – is the clearest signal yet that decentralized lending is no longer a crypto-inside experiment. This becomes an infrastructure that institutional capital intends to use.
Cover image from ChatGPT, ETHUSD chart from Tradingview
