February Newsletter
Hello Aave Community!
February was a short & busy month at Aave, with 2 epic hackathons and some exciting governance votes and updates. Keep reading for the February highlights!
Technical & Development Updates
After a governance vote, AIP-9 activated Aave Balancer Pool Liquidity Staking. Now $aBPT (Aave Balancer Pool Tokens) can be obtained by providing liquidity to the AAVE/ETH smart pool on Balancer at a 80/20 ratio. The Safety Incentives for $aBPT stakers are set at 550 AAVE/day, the same as AAVE stakers. This means a total of 1100 AAVE/day is distributed among AAVE and $aBPT stakers.
Additionally, xSUSHI and BAL have been added in the Aave Protocol!
Governance & AIPs
Some interesting topics on the governance forum include:
Use aAAVE to participate to governance
Allow users to vote with AAVE, stkAAVE and aAAVE. 11,8% of AAVE in total circulation are aAAVE and only 4,69% of the circulating supply has been used to vote during AIP 07 (a record). Most users use their AAVE as a collateral and they are currently excluded from the voting process.
Proposal: Introduce Liquidity Incentives for Aave v2
Design liquidity mining (LM) program optimised for the long term growth of Aave. ParaFi proposes a distribution of 550 Staked AAVE per day, split 50–50 between lenders and borrowers of the most popular markets. Generally, the community is strongly opposed to this proposition, as LM seems inefficient at this point.
Give depositors the choice to disable lending of the assets they deposit on Aave
Deposits are automatically made available for lending. Some users don’t want to support the lending risk. Users could have the opportunity not to have to lend their collateral.
This would probably reduce the volume of assets offered for borrowing, increasing de facto the APY.
Events & Community
MarketMake hackathon wrapped up with some incredible hacks. Check out this blog post to read about them!
Aave was also at ETHDenver, and it was cool to hang out in the virtual event space, meet new people, and see familiar faces.
Be sure to check out Stani talking decentralised lending on the Pomp Podcast and on Unchained!
Integrations
Hex Trust integrated AAVE, stkAAVE, and aTokens into its institutional-grade custody platform, Hex Safe, making it easier for institutions to access DeFi. Matrixport announced an integration of the Aave Protocol for users to earn on ETH and stablecoins. Matrixport has also added AAVE to its custodian solution. Additionally, Curv has integrated the Aave Protocol in its enterprise DeFi solution, enabling institutions to lend and borrow.
Monthly Metrics
The Aave Protocol continues to grow, surpassing $5B of liquidity during the month of February. There has been good utilisation, with outstanding loans surpassing the billion, now at $1.2 billion, with nearly $6 million of interest revenue this month. This is coupled with a high Flash Loan volume of $2.2 billion, generating nearly $2 million of fees.
Aave Outstanding Loans
https://explore.duneanalytics.com/queries/15787#31760
Most liquidity has now migrated to Aave V2, which also holds most of the Flash Loans and higher yields than V1 (with the exception of some assets such as YFI). BAL and xSUSHI have been listed, with already $5m and $200m of respective liquidity.
The Safety Module second component is now live, a 80/20% AAVE/ETH Balancer pool. In a few weeks, it has become the largest balancer pool with $225 million. This complements the $1.1 billion of Staked AAVE. The Safety Module now holds $1.3 billion, 30% of these stakes can be slashed in case of shortfall event, forming the Safety Capital now at $400 million.
Join us and stay tuned
Aave and Covalent are teaming up to bring you 3 weeks of data science challenges in Dungeons & Data! You don’t need to be particularly tech savvy to join — artists, writers, data scientists, meme connoisseurs and more are welcome to participate! Register before March 1st here.
Aave is excited to sponsor the Chainlink hackathon that kicks off March 18. Come play with DeFi building blocks, NFTs, and more.
Stay up to date on all things at Aave on Twitter or jump into the official Discord channel!
Cheers,
Aave Team