> For the complete documentation index, see [llms.txt](https://usefelix.gitbook.io/docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://usefelix.gitbook.io/docs/lending-products/publish-your-docs.md).

# Vanilla Markets

## Overview

Vanilla Markets sit alongside the feUSD CDP market as another lending option. It is built on **Morpho’s lending stack** and pair borrows and lenders.

| Side          | Role                                                                                                                  | What they supply               | What they earn / pay                                 |
| ------------- | --------------------------------------------------------------------------------------------------------------------- | ------------------------------ | ---------------------------------------------------- |
| **Borrowers** | Deposit collateral to borrow an asset (e.g., HUSD, HYPE, USDC). Debt accrues at a **dynamic variable rate**.          | Collateral (HYPE, UBTC, ETH …) | Pay a floating borrow APY determined by utilisation. |
| **Lenders**   | Supply idle assets (HYPE, USDC,‑etc.) to earn yield. Funds are matched P2P first; excess sits in the underlying pool. | Assets they wish to earn on    | Earn the borrow APY minus a small protocol spread.   |

Unlike the CDP, **there are no redemptions or borrower‑set fixed rates**—all pricing follows a utilisation curve.

### Why Use Vanilla Markets?

1. **Asset‑native borrowing** — obtain HYPE, USDC, or other supported tokens directly, avoiding the need to mint feUSD and swap.
2. **No redemption risk** — positions are immune to the feUSD peg mechanics.

#### Trade‑offs vs. the feUSD CDP

* **Higher effective borrow cost** on average (floating APR vs. self‑selected fixed rate).
* **Lower LTV** (75–80 % typical) because the Stability Pool backstop is absent.
* **Interest‑rate volatility** — costs can spike in a liquidity crunch.


---

# Agent Instructions
This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com.

## Querying This Documentation
If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter:

```
GET https://usefelix.gitbook.io/docs/lending-products/publish-your-docs.md?ask=<question>&goal=<endgoal>
```

`ask` is the immediate question: it should be specific, self-contained, and written in natural language.
`goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal.

The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.