Euler Set to Launch V2 Lending Platform with Enhanced Features and Flexibility

According to Blockworks, lending platform Euler is preparing to launch Euler v2 in the second quarter of this year, following a $200 million exploit in 2021. The new version introduces a modular design, including the Euler Vault Kit (EVK) for developers to customize lending vault designs, and the Ethereum Vault Connector (EVC), a tool for connecting ERC-4626 vaults with various smart contracts. Euler's co-founder Michael Bentley stated that v2 will offer more adaptability, freedom, and flexibility for users than its predecessor. Bentley explained that Euler v2 allows users to create decentralized, permissionless, noncustodial credit markets with risk-reward tolerance suitable for them and their users. An interesting feature of Euler v2 is the ability for users to tap into pre-existing vaults from elsewhere in the Euler ecosystem. This allows for more capital efficiency for lenders, as they can lend out their collateral while using it as collateral, a process known as rehypothecation. The public codebase for EVC has been live since January and has undergone extensive audits, with a $200,000 bounty prepared for those who can identify bugs. The EVK codebase is currently going through a round of audits, with a formal verification and security review expected to follow. Euler v2 has been in development since before the exploit in March last year, and the experience with Euler v1 taught the team valuable lessons about the need for flexibility and scalability. The Euler community governance is currently determining the next steps for relaunching v2 and incentivizing users to return to the platform.