The signatures toggle feature
By default, the Morpho app will propose you the most adjusted flow with regard to your wallet account type.
Smart wallets: toggle is off, app uses an onchain signature flow (classic approval + classic transaction only).
Externally owned account (EOA) wallets: toggle is on, app uses the offchain signature flow when available (permit or Permit2 signatures).
But, if necessary, EOA users can change this by clicking the address button at the top right of the Morpho app and switching Allow offchain signature flows on or off.
(Smart wallet users can not use the toggle and will have onchain signature flow only).
The Basics: Offchain vs Onchain Signatures
When interacting with DeFi protocols like Morpho, users need to approve tokens before they can be used in lending or borrowing operations. There are two main approaches to handle these approvals:
Offchain signatures (permit / Permit2)
You sign a message in your wallet. This is free and not a transaction.
The app then sends one transaction that uses your signature and performs the action (supply, borrow, deposit...) in the same step.
Only one gas payment.
For tokens that don't support permit natively, Permit2 needs a one-time onchain approval of the token to the Permit2 contract. After that, each action needs only a signature.
Onchain Signatures (classic flow)
Transaction 1:
approve()- you pay gas to approve the tokenTransaction 2:
supply()/borrow()or other action - you pay gas again for the actual operationMore expensive
The key advantage of offchain signatures is gas cost saving thanks to gasless permit.
Why the Difference Between EOA and Smart Wallets?
The ability to use offchain signatures depends entirely on the type of wallet being used:
EOA (Externally Owned Accounts) - MetaMask, Rabby, Rainbow, etc.
Possess a private key that can sign messages offchain
Compatible with EIP-712 (typed structured data signing)
Can use Permit2 and other offchain signature schemes
✅ Can use the optimized flow for lending/borrowing on Morpho
Smart Wallets (Safe, Argent, Coinbase Smart Wallet, etc.)
Are smart contracts, not accounts with a private key
Cannot sign messages offchain directly
To "sign", they must execute an onchain transaction (EIP-1271)
❌ Cannot use Permit2 in a practical way
Must use the classic flow:
approve()+supply()/borrow()
This fundamental difference in wallet architecture explains why Morpho App needs to detect the wallet type and adapt its flow accordingly. Smart wallets would need to execute an onchain transaction just to create the "signature", which defeats the purpose of the offchain signature optimization.
If any issue or additional question, get in touch opening the chatbox at the bottom right of the help page 👉