A lot of people pinged us at @merkl_xyz about the donation trick Steakhouse is using to boost the APR on the EURCV vault. It's an elegant way to reward every depositor in a vault at once, and Steakhouse is a serious player. But the mechanism has real downsides, on top of the transparency point already raised here (depositors can't tell the yield is incentivized, and there's no visible schedule or end date). A few that matter: You only get one lever: the total APR. Some providers don't want to pin the final rate, they want to add a fixed spread, say +2% on top of whatever the native yield is. Donation can approximate that but can't guarantee it. There's nothing keeping the payout rate below the NIM that Forge earns on the EURCV this vault allocates, so you can end up paying out more than you make. Rewards have to be paid in the vault's asset. Fine if you're a stablecoin issuer sitting on that currency, but if you're a chain or protocol wanting to incentivize in your own token, you'd have to sell it first. You can't differentiate who receives the yield. If you only want to reward users who came through a specific app or UI (say Robinhood), there's no way to gate it. Same goes for any customization of the payout: it's simply not possible It only rewards holders going forward. No retroactive distributions. On Morpho, the APR cap is global. If the underlying markets yield more than 4%, the vault stays stuck at 4% and depositors taking the liquidity risk don't capture the upside. You can raise the cap, it's one parameter, but then you risk burning through the reward budget fast if you're not actively bringing it back down as native yield falls. More subtle, and this one cuts against intuition: direct donation is actually less capital efficient for the issuer. In a claim-based setup, a share of users never claim, and that unclaimed budget can come back to you. With donation everything is paid out automatically, so you lose that breakage.