Uniswap, the largest decentralised exchange by trading volume, is expanding beyond its trading-focused business by launching 'Earn' with Morpho, the second-largest decentralised lending protocol.

The Block reported on Thursday that Uniswap Earn is structured so users deposit USDC, USDT and ether into three Morpho vaults curated by Gauntlet. Those assets are then lent to borrowers through Morpho’s lending market. Interest paid by borrowers becomes returns for depositors. Uniswap explained that users keep ownership of their assets and can withdraw at any time.

Anthony Becche (앤서니 베셰이), a staff product manager at Uniswap, said the launch of Earn is a natural next step as Uniswap was built to provide open and direct access to on-chain markets. He said Earn provides a way to put assets to work more easily without needing to separately manage concentrated liquidity positions.

The launch came shortly after SEC Commissioner Hester Peirce said crypto vaults and on-chain lending strategies may already be subject to existing federal securities laws depending on their structure. Asked about this, a Uniswap spokesperson said, "We are confident that we comply with all applicable laws and regulations."