Paul Frambot is a rather discreet person. Not his type to communicate. But for the past few weeks, the young co-founder of the "decentralised finance" protocol, Morpho, has no longer been able to hide too much... Meetings, trips, the man who is at the end of his studies at Télécom Paris and describes himself as a "mathematician" is on all fronts, while Morpho has just raised 18 million dollars (17 million euros). A record for a student project previously held by a certain Mark Zuckerberg and Facebook. In 2005, the American raised 12.7 million dollars for what was to become the biggest social network on the planet (with more than 2 billion users). It's a symbol that obviously hasn't escaped Paul Frambot.
For while he may be rather discreet, the 21-year-old Frenchman has no shortage of ambition for the DeFi protocol that he has developed from January 2021 as part of his studies with CNRS researcher Vincent Danos. "Decentralised finance is something incredible, but it's still not very efficient, and our aim is precisely to improve it," explains Paul Frambot, who is bringing 90 investors into Morpho (11 employees on permanent contracts) including giants such as Andreessen Horowitz (A16z), Variant as well as several Frenchmen such as Arianee boss and founder Frédéric Montagnon.
What is decentralised finance?
"Decentralised" finance is the opposite of "centralised" finance, i.e. the current system where you have to go through intermediaries, your bank for example, to borrow and lend money. In DeFi, there are no intermediaries, but rather "pools", which allow lenders to put money - cryptocurrencies - and borrowers to tap into this pool by paying interest. The advantage of this system is that it allows any individual or company to deposit or borrow money. The only constraint is to deposit a sort of cryptocurrency deposit with the platform to ensure that the loan will be repaid.
Today, there are several DeFi protocols. The best known are called Aave or Coumpound and manage 6 and 3 billion dollars respectively in their "pools". But however effective they may be, these protocols do not offer optimal rates. It all depends on the operation, but the lenders, those who put money into the pool, often have fairly low rates of return - often below 1% - while the borrowers pay relatively high rates - often above 4%. This is a problem that Morpho proposes to solve by matching borrowing and lending rates via its platform...
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