Lending platform Aave has announced a series of ways in which strategic investors 3 Arrows Capital and Framework Ventures will aid in its decentralization and growth, according to a blog post published on July 15.
The two strategic investors have netted $4 million in profit from investment in the LEND token. Having purchased $3 million worth of LEND at 10 cents, the asset is now worth approximately 25 cents (at the time of publishing), with their investment now totaling to over $7 million.
Aave stated that the two investors will be active market participants through staking and governance. Speaking of the role they will play in Aave’s growth, Aave founder and CEO Stani Kulechov said,
...Our focus has always been innovation and diligent risk management, which has got the attention of Framework Ventures and Three Arrows Capital. Their involvement will bring substantial expertise to scale the protocol for institutional usage and they will be helpful stakeholders within our community.
3 Arrows Capital and Framework Ventures will contribute in 4 specific ways towards Aave’s growth and decentralization. Both firms provided feedback on Aave's economic model and will participate in Aave Improvement Proposals (AIPs) in the future. Besides staking and governance, they will shift OTC borrowing and lending activity to help grow assets and help "increase market depth for larger institutional players who require deeper pools of liquidity."
Lastly, participate in an insurance fund that protects against “protocol deficits.” The latter relates to Aave’s recently released Credit Delegation feature, which provides trusted lending without the need for collateral.
Aave’s price has surged in the past 3 months, alongside several other DeFi assets. The DeFi market has experienced unmatched growth in this timeframe, thanks to the introduction of yield farming programs by Compound Finance (COMP), Kyber Network (KNC), Ampleforth (AMPL) and Balancer (BAL).