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Aave (AAVE) launches liquidity pools for institutional investors

Juil 6, 2021
4.87 (664 votes)

Aave (AAVE) launches liquidity pools for institutional investors. The team suggested that users will be able to earn between 2.1% and 3.2% on their deposited coins in a low-risk manner.

Aave (AAVE) will deploy Aave Pro. These are authorized liquidity pools accessible only to whitelisted users who have gone through a Know Your Customer (KYC) process.

Aave (AAVE)

Aave explained through two fundamental questions:

What is?

It is a a decentralised non-custodial liquidity market protocol where users can participate as depositors or borrowers. Depositors provide liquidity to the market to earn a passive income, while borrowers are able to borrow in an overcollateralised (perpetually) or undercollateralised (one-block liquidity) fashion.

Why choose it?

The Protocol has been audited and secured. The protocol is completely open source, which allows anyone to interact with an user interface client, API or directly with the smart contracts on the Ethereum network. Being open source means that you are able to build any third-party service or application to interact with the protocol and enrich your product.

Where are my deposited funds stored?

Your funds are allocated in a smart contract. The code of the smart contract is public, open source, formally verified and audited by third party auditors. You can withdraw your funds from the pool on-demand or export a tokenised (aTokens) version of your lender position. aTokens can be moved and traded as any other cryptographic asset on Ethereum.

Is there a risk?

No platform can be considered completely risk-free. The risks associated with the Aave platform are smart contract risk (risk of bugs in the protocol code) and liquidation risk (risk associated with the collateral liquidation process). All possible measures have been taken to minimize the risk as much as possible – the protocol code is public and open source and has been audited.

Aave (AAVE) one of the leaders in DeFi is interested in institutional investors, the facts:

We are talking about a one of the world’s leading decentralized finance (DeFi) companies in terms of total locked-in value, is seeking to attract institutional investors to its platform via authorized liquidity pools.

Aave Pro is designed to offer professional and institutional investors who have passed the “know-your-client” protocols access to agricultural and cash loans.

The team suggested that users will be able to earn between 2.1% and 3.2% on their deposited coins in a low risk manner.

Commenting on the new DeFi offering, Stani Kulechov reiterated that this new offering will help institutional investors to effectively remove all barriers to entry for DeFi.

It is important to note that the DeFi ecosystem is experiencing explosive growth since 2020. DeFi represents a combined global locked-in value of $111.84 billion.

For the record, at the time of writing this article, the total value locked into the protocol is $10.73 billion, according to DeFi Pulse.

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