CJ - Cryptocurrency Specialist
Aave (AAVE), an early DeFi protocol that enables decentralized non-custodial borrowing and lending, is now set to deploy on the Metis Andromeda Network after a successful vote. The move aims to attract more mainstream users and tap into a bigger market opportunity in crypto lending. Aave, which was originally called ETHLend and founded by Stani Kulechov in 2017, has been growing across a variety of different blockchains, including Ethereum, Polygon, Avalanche, Arbitrum and more.
The integration of Metis and Aave is expected to diversify users' DeFi investments and offer alternative lending and borrowing protocols, benefiting the DeFi ecosystem significantly. Aave's popularity and profitability have made it a fundamental component of DeFi, causing changes in the TVL of other ecosystems. For instance, lending protocols such as Compound and MakerDAO have experienced a decline in TVL since Aave's launch, as Aave offers consumers a greater selection of assets to borrow and lend against at better interest rates.
Aave's composability has made it possible for it to establish itself as a fundamental component of the DeFi ecosystem, and this integration is set to unleash greater benefits to users across the ecosystem, including more yields, capital efficiency, protocol safety, decentralization and user experiences. Aave’s TVL is expected to increase further once Aave launches on the Metis Andromeda Network.
Overall, this integration marks a significant milestone in the DeFi and layer 2 ecosystem, with a whole new level of diversifications set to emerge as a range of new DeFi products and services will be made possible. Users will now be able to spread their risk, diversify their DeFi investments and benefit from greater yields, capital efficiency, protocol safety, decentralization and user experiences.
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