The sentinel is Murmurr’s risk watchdog. It watches live Morpho USDC positions and can withdraw-only under stress — trim when a position dominates exit liquidity, or exit when quality / utilization tripwires fire. It exists so a high-yielding market that can no longer be exited does not silently become the whole strategy.

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Why it exists

The allocator builds a careful strategic book. Reality drifts between rotations: liquidity thins, utilization spikes, a collateral’s safety profile deteriorates. The sentinel monitors continuously and can act before the next strategic reshuffle when conditions turn hostile. On mono-collateral sleeves (WHYPE, aHYPER) there is no strategic allocator — the sentinel is the ops loop: watch liquidity share and derisk when the position dominates exit capacity.

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What it guards

The same 10% liquidity rule that sizes the allocator book is the sentinel’s first tripwire. Drift above 10% of available exit liquidity is a trim, not a debate. Actions are deallocate-only (never allocate). On diversified sleeves, idle USDC sits until the allocator’s own rules redeploy it. On mono sleeves, redeploy is a curator decision — not an allocator bot. Exact thresholds and poll cadence stay in internal policy. This page states the intent and what runs in production.

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Allocator vs sentinel

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What it is not

  • Not a promise that losses are impossible.
  • Not a full insurance fund.
  • Not a replacement for Morpho / oracle / smart-contract risk — see Risks & security.
  • Not instantaneous — black swans between checks remain possible.
  • Not a substitute for building a diversified target book — only for mono sleeves where that book is intentionally fixed.