Public Allocator

The Public Allocator adds liquidity to your vault's markets when borrowers need it, without waiting for you to reallocate. Once you enable it, anyone can move the vault's assets into a market that needs liquidity, but only within the limits you set: which markets can receive assets, how much each market can hold, and which markets or idle assets can supply them. For main concepts, see the Public Allocator and Liquidity Curation pages.

Why enable it

Markets your vault supplies get more borrowable liquidity when demand rises, which can increase utilization and yield for the vault.
You decide which markets can send and receive assets, and how much each market can hold.
Any penalty you set is paid to the vault and accrues to depositors.
Markets keep isolated risk; the Public Allocator does not merge their collateral, oracles, or risk parameters.
The vault's absolute and relative caps remain binding.
The caller never takes custody of the vault's assets.

The controls

Control	What it does
Allocator role	The vault's allocator role, given to the Public Allocator with a timelocked `setIsAllocator` change.
Active adapter	Enables a `MorphoMarketV1AdapterV2` to participate. Only adapters belonging to this vault can be used.
Public Allocator cap	Maximum allocation a market can hold after a Public Allocator move, in the vault asset. It limits the market's total allocation; it is not a budget that refills. The vault's absolute and relative caps still apply.
Allow deallocation	Per-market permission to use that market as a source. It has no amount limit, so the market can be pulled down to zero.
Allow allocations from idle	Vault-wide permission to allocate the vault's idle assets.
Penalty	Percentage of each amount moved, paid by the caller in the vault asset to the vault. It accrues to depositors, so there is nothing to claim.

Public Allocator configuration changes are sent to the Public Allocator contract, require the vault's allocator role, and apply immediately. Only adding or removing the Public Allocator as a vault allocator is timelocked.

Prerequisites

The vault is a Vault V2 on a chain where the Public Allocator is deployed.
The vault has at least one MorphoMarketV1AdapterV2 with markets that have vault caps set. See (De)List Adapters.

Tutorial: Enable the Public Allocator in the Curator App V2

Open the vault in the Curator App V2.

1. Add the Public Allocator as an allocator

Connect the vault's Curator wallet. In the vault's Overview, open Roles & Permissions. In the Allocators list, find the Public Allocator row and click Add. Review Add Public Allocator and submit.

Adding the role submits a timelocked setIsAllocator change. The row shows Addition pending until it is executable. Execute it from pending actions once the timelock ends. See Timelock.

Keep at least one other allocator, such as a team wallet or multisig, for manual allocation and recovery. The app warns if the Public Allocator would be the vault's only allocator.

2. Enable the Public Allocator on a market adapter

Connect an Allocator wallet; steps 2 to 4 require the vault's allocator role. In Overview, open Adapters. On a MorphoMarketV1AdapterV2 row, toggle Enable Public Allocator and confirm.

"Anyone can then rebalance liquidity across markets served by this adapter, within the Public Allocator caps you set."

This change applies immediately. When the adapter is not enabled, the Allocators row also links to Enable the Public Allocator on a market adapter.

3. Set caps and sources

Open the vault's Caps page and select the Public Allocator tab. The table shows Market, Allocation, Vault Absolute Cap, Public Allocator cap, and Allow Deallocation. The page also has an Allow allocations from idle switch.

Click Edit. Set a Public Allocator cap on each market it may allocate to, and allow deallocation on markets it may pull from. You can also allow allocations from idle. Review and commit the changes. All Public Allocator changes are sent in one transaction and apply immediately.

A Public Allocator cap above the vault's absolute cap or below the current allocation is allowed. It limits the market's total allocation, not one movement, and does not force assets out. A market with a zero vault cap cannot be a destination.

4. Set an optional penalty

In Overview, open Vault State and then Fees and penalties. Find Public Allocator penalty, click Edit, and enter a value under Penalty percentage in the Set Public Allocator penalty dialog. Review and submit.

A penalty is optional. It can act as an economic deterrent, for example against repeated moves made only to disrupt the vault's allocation. It also makes each move more expensive for the borrowers and apps that trigger it, which can worsen their experience or lead them to use other liquidity.

5. Check the setup status

In the Allocators list, check the badge on the Public Allocator row:

Not added means the allocator role is not set.
Setup incomplete means a required setup step is missing. Hover over the badge to see the Setup checklist: Public Allocator added; Market adapter enabled; Cap set on a market it can allocate to; A market or idle allowed as the source.
Active means the required setup is complete.

Configure via Etherscan

Configuration uses two contracts: your vault and the Public Allocator. Find the Public Allocator address for your chain in the Morpho Vault V2 addresses (BluePublicAllocator).

On your vault, with the Curator wallet: call submit with the encoded call setIsAllocator(publicAllocator, true). After the timelock ends, call setIsAllocator with the same arguments.
On the Public Allocator, with an Allocator wallet, passing your vault address to each function:
- setIsActiveAdapter to enable your MorphoMarketV1AdapterV2.
- setAbsoluteCap to set a Public Allocator cap on each destination market.
- setCanPullFromMarket to allow deallocation from each source market.
- setCanPullFromIdle to allow allocations from idle assets (optional).
- setPenalty to set the penalty (optional).

The Public Allocator changes apply immediately. See the Public Allocator contract reference for parameters.

Risk considerations

The vault's relative caps are checked against its total assets at the time of each move. A large temporary deposit raises that limit, so anyone with enough capital can make a Public Allocator move exceed the exposure a relative cap normally allows. Set each Public Allocator cap, which is always an absolute amount, at the maximum exposure you accept for that market.
Allowing deallocation from a market lets the Public Allocator pull it down to zero. If that market backs the vault's liquidity adapter, this can reduce instant withdrawal liquidity. See Liquidity Curation.
The app warns if the Public Allocator is still active on an adapter the vault no longer lists or an adapter created for another vault. Turn off the stale activation; moves through an adapter created for another vault revert.

Disable or pause

Toggle Disable Public Allocator on an adapter to stop moves through it. Its caps stay set, and other enabled adapters keep working.
Set destination caps to zero or remove source permissions to restrict moves.
Click Remove on the Public Allocator row to remove its allocator role. This change is timelocked.

Public Allocator

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