Price a Morpho market with the band

MorphoBandOracle lets a Morpho Blue market take a Robinhood Stock Token as collateral, priced by its Tapehouse band. It implements Morpho's IOracle. In this guide you read an oracle's answer, deploy one, check it before you create a market on it, and write a fresh price before you liquidate.

What the oracle answers#

price() is one whole unit of the Stock Token in units of the market's loan token, scaled by 1e36. It is the band's low edge in every state that has a price: open, closed and degraded. The loan token is taken at par with the US dollar. The oracle multiplies the band's 8-decimal price by scaleFactor, 10^(36 + loan decimals - collateral decimals - 8), which is 1e16 for an 18-decimal Stock Token against USDG's 6 decimals. The band's price on Robinhood Chain already carries the token's ERC-8056 multiplier, so the oracle applies none.

A band with no price reverts with NoAnswer. That is no price, and never zero. Morpho Blue then refuses to borrow, to withdraw collateral against debt and to liquidate. Supplying, withdrawing what is not lent, repaying and adding collateral go on.

1. Read an oracle#

import { morpho } from '@tapehouse/sdk'

const answer = await morpho.price(client, deployments, 'TSLA')
if (answer.price === undefined) {
  console.log(answer.noPrice, answer.revert.errorName)
} else {
  console.log(answer.price)
}

const halt = await morpho.halt(client, deployments, 'TSLA')
const oracle = await morpho.oracle(client, deployments, 'TSLA')

noPrice says why there is no answer, read at one block:

oracle returns the band the oracle reads, its symbol, its collateral and loan tokens, its scaleFactor and its owner. halt tells the halt's sources apart.

2. Deploy and verify an oracle#

make deploy-morpho-oracles CHAIN=<chainId> SIGNER='--account <name> --password-file <file>'
make verify-morpho-oracles CHAIN=<chainId>

The first deploys an oracle for every launch asset whose Stock Token the registry's band names, priced in .tokens.USDG and owned by .tapehouse.Owner, and records it in .morphoOracles. MORPHO_ASSETS='<ASSET> ...' limits it to the assets named. It skips an asset the band prices as a share. The second reads each oracle's constructor arguments back from it, and you run it before an oracle is re-pointed or its ownership moves.

3. Create a market#

Curators call Morpho Blue's createMarket((loanToken, collateralToken, oracle, irm, lltv)) on .morpho.Blue, with .tokens.USDG, the oracle's collateralToken(), .morphoOracles.<ASSET>, .morpho.AdaptiveCurveIrm and an enabled LLTV. Before you do, check that:

• the oracle's band() is the registry's .tapehouse.Band and its loanToken() the market's
• its owner() is a timelock
• price() answers
• the oracle is verified on Sourcify

Size the LLTV for the weekend. The band widens when the market closes, and Morpho Blue has no close factor: once a loan is past the LLTV a liquidator may repay all of it. Borrowers need headroom below the LLTV of at least the widening from the open half-width to the closed one, with room for the move on top. While the band has no price, nothing in the market can be liquidated, and a fall in the price meanwhile lands on the market's suppliers.

4. Liquidate#

While the market is closed the band has a price only while someone writes RedStone packages to it, and writePrices is open to anyone. Liquidate from a contract that calls the band's writePrices(feedIds, payload) and then Morpho Blue's liquidate, in one transaction.

import { band } from '@tapehouse/sdk'

const write = await band.writePrices(deployments, source, [feedId])

source is a PackageSource of your own, an object with payload(feedIds) that returns the signed packages as RedStone's EVM connector appends them. The SDK holds no API key and calls no gateway. The indexer's RedStone payload endpoint serves signed packages for the feeds you name. The asset's 24/7 feed ID is the second value of the band's asset(symbol), or the third, its index, where the second is zero.

A package no newer than the one stored reverts with PackageNotNewer(feedId, storedTimestampMs, packageTimestampMs). Someone wrote first, so the contract catches it and liquidates against the stored price. The band takes any signed package up to 180 seconds old that is newer than the one stored.

Errors you may hit#

Next#

• The Morpho oracle contract.
• Read a price for the band the oracle reads.
• Keepers, which write the band's prices.