What Is Euler (EUL)? The Governance Token Behind the Lending Protocol

Euler is a permissionless lending protocol built for the long tail of crypto assets on Ethereum. It introduced a risk-driven approach to listing and managing assets, aiming to extend borrowing and lending beyond the most liquid tokens. At the center of that governance system is EUL, the token that lets the community steer protocol parameters, approve asset listings, and shape the protocol’s future.

This article explains what Euler is, how EUL works, and how governance decisions affect borrowers, lenders, and liquidity providers. We also cover security, recent developments, and practical steps to participate responsibly.

Euler in Brief

Euler’s design focuses on capital efficiency with guardrails:

• Risk-based markets: Euler classifies assets by risk to determine how they can be used as collateral and whether they can be borrowed in cross or isolated markets. See the protocol overview and risk framework in the documentation. Read more.
• Dynamic interest rates: Rates adapt to utilization, helping markets find equilibrium without excessive manual tuning. Protocol docs.
• Liquidations and auctions: Euler aims to minimize bad debt via efficient liquidations and market-driven pricing.
• Oracles: Euler uses on-chain price feeds, including Uniswap TWAP mechanisms, with governance oversight on which oracles are permitted for specific assets. More on oracles.

The protocol experienced a major exploit in March 2023, after which funds were largely returned and the community re-focused on hardening risk controls and processes. If you want a historical snapshot of the incident and resolution, see coverage from reputable sources. Background: CoinDesk reporting and follow-up.

What Is EUL?

EUL is Euler’s governance token. It does not grant claim on protocol revenues by default nor confer legal rights; its core utility is on-chain governance.

With EUL, token holders can:

• Propose and vote on parameter changes (e.g., collateral factors, borrow caps, interest rate curves)
• Approve or delist assets
• Adjust oracle configurations
• Manage treasury actions and safety mechanisms
• Ratify upgrades and timelock changes

You can explore the live governance space and recent proposals on Tally. Euler on Tally.

For market and contract metadata, refer to trusted data aggregators. EUL on CoinGecko.

How Governance Works

Euler governance generally follows a standard Ethereum DAO stack:

• Delegated voting: EUL holders can delegate votes to themselves or to other addresses, including delegates focused on risk or research. Governance portal.
• Proposal lifecycle: Proposals typically require a threshold to create, followed by an on-chain voting period, and—if passed—execution via a timelock. Details and thresholds are set by the DAO and can change through governance.
• Scope of changes: Risk parameters, listing criteria, oracle sources, and incentives are all within governance. Technical upgrades pass through audit and review steps before consideration.

Snapshot spaces are often used for off-chain signaling to gauge sentiment before formal on-chain proposals. Euler Snapshot.

Token Supply, Distribution, and Contract

Token supply, distribution schedules, and contract details can evolve. Always verify the current contract and circulating supply from canonical sources:

• Contract and holders: EUL on Etherscan
• Market data: EUL on CoinGecko
• Documentation: Euler docs

Note: Be cautious of spoofed contracts and look up the official address via multiple sources before interacting.

Why EUL Matters

• Risk governance: Lending protocols live and die by how they manage collateral risk. EUL holders directly influence those guardrails.
• Asset expansion: As new tokens gain traction, governance decides if and how they are supported.
• Protocol resilience: Post-incident, good governance is a core defense—formalizing risk reviews, oracle choices, and emergency processes.

For users, governance stability often translates into more predictable borrowing costs, safer collateral practices, and clearer listing criteria.

2025: What’s New and What to Watch

In 2025, governance in DeFi continues to emphasize resilience, with communities prioritizing:

• Tighter oracle policies and diversified data sources for long-tail assets
• Conservative parameter tuning for assets with episodic liquidity
• Improved communication between risk contributors and token holders

Euler’s governance cadence and proposal flow are visible on the public governance venue. Expect topics such as asset listings, parameter refinements, treasury management, and protocol upgrades to remain front and center. Review current proposals.

How to Participate in Euler Governance

• Acquire EUL from reputable venues and verify the contract carefully. Market data reference.
• Delegate your votes to yourself or a trusted delegate with domain expertise. Delegate on Tally.
• Follow discussions, risk reports, and Snapshot signaling; only vote after you’ve reviewed the rationale. Snapshot space.
• Practice safe key management and sign governance messages from secure wallets.

Risks and Considerations

• Market risk: Governance tokens can be volatile; don’t overexpose yourself.
• Smart contract risk: Even audited systems have residual risk; track upgrade notes and audits via official channels. Euler docs.
• Governance capture: Low voter participation or concentrated holdings can skew outcomes; delegation to credible, transparent delegates helps.

Security Best Practices and Storing EUL

If you plan to hold and vote with EUL, strong operational security matters. A hardware wallet reduces the attack surface by keeping private keys offline while enabling on-chain actions via secure signing.

OneKey is designed for multi-chain EVM assets and governance workflows:

• Open-source firmware and reproducible builds for transparent security
• Easy connection to major Ethereum dApps for voting and delegation
• Secure signing for governance transactions while keeping keys offline

For active voters or DAO contributors, using a hardware wallet like OneKey can meaningfully lower the risk of key compromise during proposal creation, delegation, or voting.

Final Thoughts

Euler is a compelling case study in permissionless lending for long-tail assets. EUL brings the community into the driver’s seat, enabling adaptive risk management and protocol evolution. If you’re participating, treat governance like a responsibility: verify data, weigh tradeoffs, and secure your keys.

As Euler evolves through 2025, watch the governance forum and proposal feeds, audit releases, and oracle policy updates. Whether you’re lending, borrowing, or voting, informed participation is the foundation of safer, more resilient DeFi.