What is Euler (EUL)?

Deep Dive

1. Core Functionality

Euler operates as a “lending super app,” allowing users to create isolated markets for any ERC-20 token using its Euler Vault Kit (EVK). These vaults enable:
- Permissionless asset listing
- Customizable collateral rules
- MEV-resistant liquidations
- Integration with yield-bearing tokens like Pendle’s PTs (CoinMarketCap).

The Ethereum Vault Connector (EVC) lets vaults interact securely, enabling cross-collateralization without exposing protocols to unrelated debt risks.

2. Institutional Appeal

Euler’s architecture caters to regulated entities through features like:
- Permissioned markets: Institutions can restrict access to whitelisted participants.
- RWA compatibility: Supports tokenized assets like BlackRock’s BUIDL fund and Tether’s XAUT gold-backed tokens (The Block).
- Risk management: Partnered with Gauntlet for dynamic parameter adjustments and liquidation safeguards.

3. EulerSwap Integration

Its native DEX, EulerSwap, merges lending and trading:
- Liquidity providers earn lending yields while supplying swap liquidity.
- LP positions can collateralize loans, enhancing capital efficiency.
- Customizable AMM curves allow tailored strategies for DAOs and market makers (The Defiant).

Conclusion

Euler redefines DeFi lending by blending modular design with institutional-grade tooling, positioning itself as a bridge between traditional finance and onchain ecosystems. How will its focus on RWAs and isolated markets shape the next wave of DeFi adoption?