🅰🅰🆅🅴 is a London-based company founded in 2018. The company's goal is to solve some problems arising from centralized markets such as PayPal, Skrill and Coinbase. Their main product is Aave Protocol, an open source, non-custodial protocol based on the Ethereum blockchain.
It is a lending platform such as Maker or Compound.
What does it mean? Users can earn interest on deposits and borrow assets.
Then users provide liquidity by depositing cryptocurrencies in loan pools which will allow them to earn interest. Meanwhile, borrowers can obtain loans by tapping into these loan pools in an over or under-collateralized manner. Deposits in the pool and borrowed amounts are used to make instant loans based on the status of the pool.
⚠️Supported Pools: Aave Market, Uniswap, Set Market (coming soon)
⚠️For liquidations, Aave uses Chainlink as a decentralized oracle.
⚠️Borrow can be "variable" (depends on supply / demand) or "stable" (I can change from one to another without problems).
How does it work? I have to connect my wallet (Coinbase, Metamask, Ledger, etc) and then "access".
The menu is very simple: dashboard (to check interest), loan and borrow.
Deposit APY increases with demand, if instead the supply increases it decreases (Dai has also exceeded 20% interest!).
WHY IS IT BETTER THAN OTHER LOAN PLATFORMS?
✅The very interesting thing is that the interests can be credited directly to your Ethereum wallet (without having to make transfers).
✅Other unique feature are the "Flash Loans" or these allow customers to take out loans without any collateral. These flash loans allow a custom smart contract to borrow resources from Aave's stock pools within a transaction. The loan is granted on the condition that the cash is returned to the pool before the end of the transaction.
This feature is designed to allow developers to create instruments that require capital for liquidation, arbitrage or refinancing purposes.
✅Interest (stable and variable) higher than other DEFI platforms
✅There are more tokens than Maker or Compound
✅Through the native GasToken, Aave will cut gas costs by 50%
LEND is an Erc20 and can be used for commission reduction. Tokens are burned from the fees collected by the Aave protocol, with around 80% of the platform fees used. So the Lend value will increase over time.
Additionally, LEND tokens can be used to vote on Aave's improvement proposals (AIPs).
AAVE TOWARDS MASS ADOPTION?
Over the past few days, the LEND token has risen to a new all-time high ($ 0.59 to $ 0.86). The strong upside comes with Bitcoin and most of the altcoins in red (apart from New Polkadot and Cosmos).
The most recent rally appears to be driven by news that the decentralized lending and credit protocol has been licensed by the Electronic Money Institution (EMI) from the United Kingdom Financial Conduct Authority (FCA). This allows Aave's parent company, Aave Limited, to "issue electronic money (electronic money) and provide payment services".
According to Aave CEO Stani Kulechov, the FCA approval is in line with the company's future plans for the protocol and will help bring new partners into the ecosystem (the next step is expansion across Europe).
However, there has also been other relevant news on Aave in recent months, which explains why LEND has risen nearly 5,000% since early 2020.
The company recently launched its Aavenomics proposal, which (if approved by token holders) will bring many changes such as adding rewards for LEND holders.
Additionally, Defi Pulse data shows that the Aave protocol recently hit $ 1.52 billion in total locked-in value by outperforming Maker, Curve, Compound.
Sure there is some FOMO on LEND but Aave is a very good project with a great future. This is evidenced not only by the cryptocurrencies locked on the platform but also by the fact that volumes are increasing sharply. For more info: Aave