Euler

About Euler (EUL)

What Is Euler (EUL)?

Euler is a modular lending protocol for EVM networks. Instead of running one shared pool that lists assets by governance vote, Euler lets anyone deploy an isolated lending vault for any ERC-20 token and then connect vaults so that a deposit in one can serve as collateral for a loan from another. Markets are assembled from those blocks rather than granted by a central risk committee.

EUL is the protocol's ERC-20 governance token. It carries voting power in Euler DAO, is used as the reward asset in Euler's incentive programs, and is the payment token in Euler's Fee Flow mechanism when that mechanism is switched on. Euler's current architecture, known as Euler v2, launched in September 2024 and is a full rebuild rather than an upgrade of the earlier version.

Official sources:

• euler.finance
• Euler documentation
• Euler GitHub
• EUL token on Etherscan

Who Founded Euler? (History)

Euler was built by Euler Labs, co-founded and led by Michael Bentley. The first version went live on Ethereum mainnet in December 2021, and EUL was distributed to users and contributors from early 2022.

On March 13, 2023, Euler v1 was exploited for roughly 197 million dollars. The attack combined flash-loaned liquidity with a flaw in how the protocol's donateToReserves function interacted with liquidation logic, pushing an account into an unhealthy state that could then be liquidated on terms that drained the pools. What followed is unusual in decentralized finance history: over the next three weeks the attacker returned the assets, Euler has stated that 100 percent of user funds were recovered, and the DAO ran a redemption program for affected users.

Euler then spent roughly eighteen months rebuilding. Euler v2 shipped in September 2024 after an extensive review program, and the protocol's documentation is explicit that v2 should not be described as the exploited protocol, because it is a different codebase built on new primitives. EulerSwap, a vault-connected automated market maker, followed in 2025.

How Euler Works

Euler v2 rests on two primitives.

1. The Euler Vault Kit The EVK is the contract framework used to create individual lending vaults. Every EVK vault is an ERC-4626 vault with borrowing logic attached. Deploying one is permissionless for any ERC-20 asset, and the deployer chooses the collateral relationships, oracle route, interest rate model, supply and borrow caps, loan-to-value factors, and liquidation settings.

2. The Ethereum Vault Connector The EVC is the coordination layer that lets vaults recognize deposits held in other vaults as collateral. It provides batching, deferred health checks, EIP-712 permit execution, operator delegation, and 256 virtual sub-accounts per address so users can isolate positions without juggling wallets. When a user borrows, they designate a controller vault for that EVC account, which is what gives the borrowing vault authority over the enabled collateral set.

A borrower supplies collateral into an accepted vault, enables it on an EVC sub-account, and borrows from a liability vault. That liability vault values collateral and debt through its own oracle route and enforces its own borrow and liquidation loan-to-value factors, caps, and account checks, while interest accrues according to its interest rate model. If the account falls below requirements it becomes eligible for liquidation through a reverse Dutch auction that discovers the smallest discount a liquidator will accept, which keeps liquidation penalties low.

Key Ecosystem Components

• EVK vaults, in governed, escrow, and ungoverned varieties. Escrow vaults hold collateral only and pay no interest because nobody can borrow from them. Ungoverned vaults have fixed parameters and split further into those with zero governance exposure through their collaterals and those with non-zero exposure.
• EulerEarn, ERC-4626 vaults that allocate a single deposited asset across configured strategies under a curator, allocator, and guardian role set.
• EulerSwap, a single-provider automated market maker that acts as an authorized EVC operator for one Euler account. Assets stay in the provider's lending vaults while the pool quotes and settles swaps, and when configured it can borrow an output shortfall just in time rather than holding idle inventory.
• The oracle framework, routing prices per vault or per router across providers including Chainlink, Pyth, Redstone, and Chronicle, with explicit units of account and ERC-4626 share pricing paths.
• Hooks and hook targets, optional contracts that gate or block operations such as deposit, borrow, or liquidation, used for permissioned and real-world-asset markets.
• Reward Streams, which distribute incentives to depositors without moving shares into a separate staking contract.
• Euler DAO and its treasury, plus governor and factory-governor contracts with timelocks and emergency roles.

Euler v2 is deployed on fifteen production networks, including Ethereum, Arbitrum, Base, BNB Smart Chain, Avalanche, Polygon, Linea, Sonic, Unichain, Berachain, BOB, TAC, Plasma, HyperEVM, and Monad.

EUL Token Utility

EUL is used for three things:

• Governance. EUL holders vote on protocol changes and treasury use through Euler DAO. Voting and execution are separate steps, and treasury transactions follow a multisig signing policy.
• Rewards. EUL is the asset behind Euler's incentive programs, most visibly through rEUL, a locked form of EUL granted to users of supported markets. rEUL converts one-to-one into EUL over six months on a non-linear unlock schedule, and each transfer to a wallet starts its own separate unlock, which makes rEUL behave as a non-fungible position despite its ERC-20 interface.
• Fee Flow payments. When Fee Flow is active, buyers pay EUL to a configured receiver in exchange for fee assets held by a Fee Flow controller, and paying EUL in does not itself burn it. As documented by the protocol, Fee Flow has been turned off and Euler protocol fees are currently set to zero across live and future deployments, a change the DAO can reverse.

On supply, the Ethereum token contract reports a total of 27,182,818 EUL, a deliberate reference to Euler's number. EUL is not hard-capped: the contract lets the holder of its admin role mint 2.718 percent of total supply no more than once every 365 days, sent to the address returned by the contract's treasury function. EUL also exists on several other chains through a mint-and-burn adapter, so confirm which chain's deployment you hold.

What Makes Euler Unique?

Euler's core idea is that risk should be a property of a market rather than of the whole protocol. Anyone can list any token, because listing means deploying a vault, and the risk parameters travel with that vault instead of applying globally. The EVC then removes the usual penalty of isolated markets by letting collateral in one vault back a loan from another, recovering much of the capital efficiency fragmented markets normally lose.

The second distinctive element is reverse Dutch auction liquidation, which lets competition among liquidators set the discount rather than fixing a flat bonus, moving value back to borrowers and lenders rather than to liquidation bots.

How Euler Differs from Similar Protocols

Monolithic lending protocols pool many assets together and gain capital efficiency from shared collateral, but add new assets slowly under conservative, uniform parameters set by governance. Fully isolated markets go the other way: listing is easy, but liquidity fragments and collateral cannot be reused.

Euler sits between the two. Vault creation is permissionless, as in isolated designs, while vault-to-vault collateral relationships through the EVC restore composability, as in pooled designs. The trade-off is that a user must evaluate each market individually, because two vaults holding the same asset can carry very different oracles, caps, loan-to-value factors, hooks, and governors. Euler's documentation makes this point repeatedly: labels are descriptive, and the live configuration of a specific vault is what determines risk.

Use Cases of Euler

• Supplying assets into an EVK or EulerEarn vault to earn interest
• Borrowing against collateral held in a separate sub-account
• Building leveraged positions through the protocol's borrow-and-swap flow
• Curating markets by deploying vaults and setting collateral relationships, caps, loan-to-value factors, oracles, and interest rate models
• Launching permissioned or institutional markets, including tokenized and real-world-asset markets, using hooks to enforce transfer or access restrictions
• Providing liquidity through EulerSwap while the same assets sit in lending vaults
• Integrating Euler through its software development kit, data API, lens contracts, and subgraphs

How Euler Is Secured

Euler v2 shipped after an unusually heavy review program: 31 audits from firms including Certora, Trail of Bits, OpenZeppelin, Omniscia, and OtterSec, alongside formal verification and fuzzing. A 1.25 million dollar Cantina security competition drew more than 600 participants and produced no high or medium severity findings, and a 3.5 million dollar Hats Finance capture-the-flag placed live funds in Euler markets for 13 days without loss. Euler runs a bug bounty of up to 7.5 million dollars for a qualifying finding and participates in the SEAL Safe Harbor framework.

Operationally, Euler verifies security-relevant deployments at the bytecode level, matching on-chain code to a build from a specific source commit and comparing it against the latest audited baseline, with per-chain reports published and reproducible using the open-source euler-verifier tool. Factory-level and vault-level pause controls exist, governed by timelocks.

Risks and Considerations

• Smart contract risk remains, and audits reduce but do not remove it. Euler's own documentation says this plainly.
• Oracle risk. Each vault chooses its own oracle route, so manipulation, staleness, and misconfiguration are per-market risks, not protocol-wide ones.
• Governance and role compromise. Governed vaults, factory governors, and curator roles hold real power over parameters.
• Permissionless listing means low-quality or malicious assets, hooks, and callbacks can appear in vaults that look superficially similar to safe ones.
• Liquidity and liquidation failure. Thin markets can leave positions unliquidatable, which is how bad debt forms.
• ERC-4626 donation and conversion attacks, which Euler documents explicitly as a known attack surface for share-based vaults.
• Correlation and recursion risk in looped or leveraged positions.
• Token-level considerations, including the once-yearly mint allowance in the EUL contract and the separate unlock schedules attached to rEUL.
• Historical context. The 2023 exploit affected Euler v1, and while funds were recovered, it is a real part of the protocol's record.

Why Euler Matters

Euler matters for two reasons. Architecturally, it is one of the most complete attempts to make lending modular, and the Ethereum Vault Connector is released as an open primitive that other teams can build on without using Euler's vaults. Historically, it is the clearest case of a major decentralized finance protocol suffering a nine-figure exploit, recovering user funds in full, and returning with a rebuilt codebase and a published verification record.

Where Can You Buy Euler (EUL)?

EUL trades on centralized exchanges and on decentralized exchanges across the chains where the token is deployed. Availability varies by jurisdiction. Because EUL exists on multiple networks through a bridging adapter, confirm which chain a venue is quoting before withdrawing.

Major Centralized Exchanges (CEX)

EUL is often available on:

• Coinbase
• Kraken
• OKX
• Gate
• KuCoin

Common pairs include EUL/USD and EUL/USDT where supported.

Storage Options After Purchase

EUL can be stored:

• On an exchange, in custodial form
• In a non-custodial EVM wallet on Ethereum or another supported network
• In a hardware wallet paired with EVM wallet software

Verify the network and the exact token address before any deposit or withdrawal, and note that rEUL rewards are a distinct instrument from EUL with their own unlock rules.

Related Coins

You can compare EUL with related lending and DeFi ecosystems on Coinrithm:

• Aave (AAVE)
• Morpho (MORPHO)
• Compound (COMP)
• Uniswap (UNI)
• Ethereum (ETH)