Credit protocol Morpho has launched Morpho Midnight on Base, adding fixed-rate, fixed-term loans to its onchain credit network, in addition to the variable-rate markets offered through Morpho Blue.
In an announcement to Cointelegraph, Morpho said the supply-driven protocol lets lenders and borrowers propose their own interest rates, terms and other loan terms rather than relying on a protocol-defined usage curve. Loans are issued as firm commitments, with terms determined through competitive offers rather than algorithmic pool pricing.
Predictable interest rates and defined terms are standard features of traditional credit markets. However, they remain uncommon in decentralized finance (DeFi), where funding costs generally fluctuate based on market usage. Fixed terms can make on-chain lending more attractive to institutions and companies that need to manage financing costs, returns and risk exposure in advance.
A spokesperson for Morpho told Cointelegraph that Midnight is live on the Base mainnet and initially supports cbBTC and $USDC over multiple due dates. The spokesperson said Morpho deliberately kept the launch contained as part of a gradual rollout that prioritizes security.
The spokesperson said crypto-native lenders, borrowers and trustees already active on Morpho Blue had expressed interest in Midnight. Several unnamed companies and institutions are also building products based on the protocol in beta, and announcements are expected once these products go live.
Morpho’s fixed-rate loan plans are taking shape
Morpho first outlined the fixed-fee system in 2025 under a broader ‘Morpho V2’ roadmap. It described an intent-based, peer-to-peer marketplace where users could submit customized offers, price loans based on market demand, and hold capital with variable returns until a fixed-rate offer is matched.
In April, Morpho named the fixed-rate protocol Midnight and clarified that it was not a replacement for Morpho Blue. While Blue offers open-ended, variable-rate loan pools, Midnight externalizes loan risk, interest and term to market participants.
The protocol then published Midnight’s whitepaper and codebase in May, which stated that the ‘offered capital’ model was intended to avoid a recurring problem for fixed-rate DeFi protocols: liquidity lock-ups or fragmentation across maturities.
Midnight’s launch follows Morpho’s $175 million funding round in June, led by Paradigm, Andreessen Horowitz’s a16z crypto and Ribbit Capital. Morpho said at the time that it planned to expand integrations with banks, asset managers and major platforms while adding features related to traditional credit markets.
Morpho’s infrastructure already supports floating rate loan products distributed through major crypto platforms. In April, Coinbase launched Morpho-powered $USDC loans for users in the United Kingdom, allowing them to borrow against Bitcoin (BTC), Ether (ETH) and cbETH on Base.
The loans had variable interest rates and no fixed repayment schedule, illustrating the open-ended lending model that Midnight aims to complement.