Euler V2 is live.
Euler V2 is modular lending infrastructure for creating, connecting, and operating onchain credit markets. It gives builders and curators the primitives to deploy ERC-4626 vaults, define market parameters, connect collateral relationships, and support different lending market structures through one shared architecture.
The Power of Modularity
Euler V2 is designed around modular vaults.
Each vault can define its own asset, collateral relationships, oracle configuration, interest rate model, caps, liquidation parameters, governor, and curator. That makes it possible to create markets for crypto-native assets, tokenized assets, synthetic assets, or other supported collateral types with market-specific rules.
Modularity does not remove risk. It makes the design choices explicit. Users, curators, and builders can evaluate the parameters, collateral relationships, liquidity, governance path, and oracle configuration behind each market.
How Euler V2 Works
Euler V2 is built on two core components: the Euler Vault Kit and the Ethereum Vault Connector.
The Euler Vault Kit is a framework for creating ERC-4626 lending vaults. Vault creators can configure market parameters, define whether a vault has a governor, and choose how collateral, borrowing, pricing, and liquidation logic should work.
The Ethereum Vault Connector lets selected vaults recognize deposits in other vaults as collateral. This creates composable collateral relationships without forcing every market into one shared risk pool.
A new vault can accept deposits from existing liquid vaults as collateral. Existing vault deposits can gain new utility when other markets recognize them as collateral. This lets markets connect where the design calls for it, while keeping rules and risk parameters defined at the vault level.
Vault Types
Euler V2 supports several vault structures. Each vault is an ERC-4626 vault that can be connected through the Ethereum Vault Connector, allowing selected vaults to recognize one another as collateral while keeping parameters defined at the vault level.
Isolated Vaults
Isolated vaults hold deposits that can be used as collateral for borrowing from selected connected vaults. They do not allow borrowing from the vault itself.
Earn Vaults
Earn vaults allocate deposits across selected Euler markets or compatible strategies according to curator-defined rules. Users interact with one vault position, while the curator defines the market set, allocations, limits, and rebalancing logic.
Governed Vaults
Governed vaults can support collateral use and borrowing. A governor can update selected parameters such as risk settings, rates, caps, or other configuration paths depending on the vault design.
Ungoverned Vaults
Ungoverned vaults have fixed parameters and no active governor path. They can still be composed through EVC, but their own parameters cannot be actively updated after launch.
A Modular Credit Layer
Euler V2 is not a single lending market. It is infrastructure for creating many market structures from the same primitives.
Builders can launch isolated markets around specific assets. Curators can operate vaults or market groups with defined parameters. Institutions can create markets for tokenized assets or permissioned flows using hooks. Applications can integrate lending, borrowing, and collateral workflows directly into their products.
The result is a credit layer where markets can be created, configured, connected, and operated according to the assets and use cases they support.
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