Aave (AAVE/USD) is a decentralised finance (DeFi) protocol that enables people the opportunity to lend as well as borrow cryptocurrencies.
The lenders can earn interest by depositing digital assets within specific liquidity pools, whilst borrowers can use their crypto as collateral and take out a flash loan using the liquidity.
AAVE is the native cryptocurrency token that powers all of this; however, another cryptocurrency was just approved, specifically, the GHO stablecoin.
The GHO stablecoin approval as a catalyst for growth
We covered how Aave Companies introduced GHO, which was a proposal for a stablecoin to be launched on top of the Aave Protocol.
The decentralized autonomous organization (DAO) voted with 501,000 AAVE, or 99.9% in the affirmative, when compared to 17 abstentions and 12 against the idea, according to the results from the voter snapshot that started on July 28, 2022, and ended on July 31, 2022.
The governance proposal’s snapshot approval claims that GHO will provide benefits for the community through the Aave DAO by sending 100% of the interest payments on GHO borrows to the DAO.
Aave users and borrowers will be allowed to mint GHO against their supplied collaterals whilst also earning interest on the underlying, similarly to how other borrowed transactions function.
However, unlike algorithmic stablecoins, crypto-backed stablecoins are assets that are collateralized by a basket of other digital assets.
Should you buy Aave (AAVE)?
On August 1, 2022, Aave (AAVE) had a value of $98.62.
To see what kind of value point this is for the cryptocurrency, we will be going over its all-time high point of value, as well as its performance throughout the
