TradFi giant Apollo enters crypto lending arena via Morpho deal

Traditional finance giant Apollo Global Management Inc. has signed a partnership agreement with decentralized lending platform Morpho to take a significant stake in the project and help support its blockchain lending infrastructure. 

The move was announced on Friday by the Morpho Association, the nonprofit organization behind the decentralized finance (DeFi) platform. 

The partnership, or “cooperation agreement,” will see Apollo or its affiliates buy up to 90 million Morpho (MORPHO) governance tokens over the next four years, representing 9% of the total 1 billion-token supply of MORPHO. 

“Under the Agreement, Apollo or its affiliates may acquire MORPHO tokens through a combination of open-market purchases, OTC transactions, and other contractual arrangements, subject to an overall ownership cap of 90 million MORPHO tokens over a 48-month period as well as transfer and trading restrictions,” the Morpho Association said.

The Morpho Association added that they will also be working together to “support onchain lending markets on Morpho’s protocol,” without providing further specifics. 

The move saw a 17.8% bump in the price of MORPHO over the weekend, rising from around $1.12 on Friday to $1.32 at the time of writing, according to CoinGecko data.

However, the asset is down 38% over the past 12 months amid a broader crypto market slump.

Morpho is the sixth-largest DeFi protocol on the market, with $5.8 billion worth of total value locked, according to DeFi Llama. The project primarily provides lending markets and curated investment vaults for investors to earn yield.  

Related: BlackRock enters DeFi as institutional crypto push accelerates: Finance Redefined

The deal with Apollo, a multinational asset manager with nearly $940 billion worth of assets on its books, marks another significant partnership secured by Morpho in recent months. 

In late January, Cointelegraph reported that digital asset manager Bitwise had jumped on board to provide curated vaults offering a 6% annual yield on Morpho. Last week, Bitcoin DeFi project Lombard also announced that Morpho had signed on as an initial liquidity partner as part of its launch of Bitcoin Smart Accounts. 

Meanwhile, Apollo has been gradually upping its exposure to crypto and blockchain. Last year, the firm partnered with Coinbase to develop stablecoin credit strategies and made an undisclosed investment in Plume to support its real-world-asset tokenization infrastructure. 

Magazine: Coinbase misses Q4 earnings, Ethereum eyes ‘V-shaped recovery’: Hodler’s Digest, Feb. 8 – 14