Moonwell Vaults: Easy Double-Digit Yields on Base with USDC, ETH, & EURC

We just published a new Edge Podcast featuring Moonwell Founding Contributor Luke Youngblood and so I thought it would be timely to share a related tutorial on Moonwell Vaults. Listen/watch the latest episode below!

Moonwell Morpho Vaults make earning yields on your assets simple, secure, and highly efficient, thanks to an innovative collaboration between Moonwell, Morpho, Block Analitica, and B.Protocol. These vaults offer a streamlined experience, allowing users to earn with single deposits in USDC, ETH, or EURC without the complexity of managing multiple positions. Built on Morpho’s advanced lending protocol, the vaults dynamically allocate funds across various markets to optimize returns, while ensuring robust risk management and security.

At the core of Moonwell Morpho Vaults is a focus on capital efficiency and transparency. Each vault structure is fully onchain and immutable, meaning every function is traceable and protected from modification, which ensures a higher level of security for users. Vault curators, such as Block Analitica and B.Protocol, implement optimized lending strategies (see example below for Moonwell Flagship USDC Vault), allocating deposited funds across various Morpho markets to maximize returns according to predefined parameters. This means users deposit once and can enjoy ongoing, auto-compounding yields as borrower fees and any additional incentives accumulate back into their holdings.

Designed with ERC-4626 compliance, Moonwell Vaults are interoperable with other DeFi protocols, making it easy to earn across the ecosystem. When it’s time to withdraw, users can redeem their share tokens to receive their initial deposit plus any accrued earnings. Moonwell’s Morpho Vaults are a practical and powerful option for anyone looking to put USDC, ETH, or EURC to work effortlessly in DeFi.

As of this post, there are the following three vaults with a combined $130M in deposits on Base.

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How to Earn 11% APY with the Moonwell USDC Vault

Let’s dive into a tutorial on how to get started with the Moonwell Flagship USDC vault!

Here’s a few risks to consider:

• Smart contract risk in any underlying protocols including Moonwell and Morpho

• Front-end spoof attack on an app frontend

• An economic design exploit

• Limited liquidity to withdraw due over-utilized borrowing in vault strategies

• Colluding signers on any multisig

• Systemic risk across DeFi, including a stablecoin depeg

1. First, I connect my Base wallet (ie MetaMask) to the Moonwell dApp here under Vaults tab.

2. Then, I choose from the available Moonwell Vaults, in this example the Moonwell Flagship USDC Vault here. I will opt to earn 11% APY with USDC, thanks to the Base APY on Moonwell, WELL rewards, and USDC rewards.

3. Lastly, assuming I have USDC in my Base wallet, I can specify how much USDC to deposit, and follow the prompts to Approve and Deposit USDC into the vault (2 transactions) and start earning the estimated APY.

4. Lastly, I can track my deposited USDC + yield earned here on the Portfolio tab where I can withdraw anytime for no fees.

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