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June 21, 2021 - Growth, RAI, and Grant Recipients

A recap of the Aave ecosystem, June 14th to June 20th 2021

Hey Aavengers 👻 and welcome to Aave News - a recap of what is happening in the Aave ecosystem, brought to you by the Aave Grants DAO. Highlights this week include continued signs of Aave’s on-chain and off-chain growth, a new collateral asset, Stani getting behind the mic, and the first batch of grant recipients from yours truly!

State of the protocol 📰

New stats. The Aave protocol continues to grow, notably over the past week:

  • The protocol generated a total of $7.7m including $742k for the ecosystem and distributed an additional $12.9 million worth of $StkAAVE and $WMATIC in liquidity mining rewards;
  • The Safety Module holds $1.3B (APRs: $stkAAVE at 7.0%, $StkaBPT at 16.9%);
  • $CRV is the top APY for depositors at 8.7%.

These stats were pulled from the Aave newsletter put together by @A_BertoG - subscribe on aave.com or follow along on the governance forum.

Ecosystem 🧉

Revolut and Sygnum add support for AAVE. Aave’s adoption off-chain continued as UK based Revolut and Switzerland based Sygnum announced plans (here and here respectively) to support AAVE on their platforms. In Revolut’s case, this will allow for their over 15 million users across 35+ countries to gain exposure to defi assets and, likely overtime, be onboarded directly to defi protocols through these apps. This is what BanklessHQ calls the “defi mullet”, when there is a familiar fintech experience with an app but behind the scenes the experience is powered by defi. Sygnum’s announcement included plans to add support for earning directly through defi protocols like Aave, and although their announcement did not mention it, Revolut will likely be not far behind with similar support.

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Photo caption: The defi mullet - h/t @BanklessHQ, original article.

Governance ⚖️

The universities are coming. Penn Blockchain and Blockchain@Brown announced that they will start participating in Aave governance, joining Blockchain at UCLA and HEC Montreal who are already active delegates.

To see a full list of current Aave delegates and their total vote count, check out https://sybil.org/#/delegates/aave or if you are reading from a university and are interested in becoming a delegate, you can find out more information about Sybil here.

New market watch 💹

Welcome RAI! On Thursday, voting for AIP 22 ended, resulting in RAI being added as a collateral asset to Aave V2. RAI is a governance minimized stablecoin from Reflexer Labs that is backed only by ETH and maintains a moving peg.

This increases the amount of stablecoin collateral on Aave and helps to diversify the collateral in the protocol by adding a non-dollar pegged stablecoin.

As @Monetsupply points out, RAI is starting with a max LTV ratio of zero to limit the initial risk to the protocol. Put simply, since users cannot borrow assets against the value of their RAI deposit, there is no risk to the other markets in the protocol so any event would be contained to just the RAI market.

If you want more information about the AIP, you can read the full motivation, specification, rationale and implementation details here. To learn more about RAI and Reflexer Labs, Bankless hosted a great AMA with Reflexer’s founder Stefan Ionescu or check out their website.

Mark your calendar 📆

HackMoney by @ETHGlobal, sponsored by the Aave Grants DAO, is happening now through July 9th

Messari announced that Stani will be a keynote speaker at their conference, Mainnet 2021, happening in New York from September 20th to 22nd

Aave in the wild 🎙

Polygon Power Hour with Mark Cuban. On Tuesday, Stani shared the stage with Mark Cuban, Sandeep Nailwal from Polygon, and Roc Zacharias from Quickswap.

You can catch the full hour conversation here (starts at ~3:12:30). One thing that stood out was the positive feedback loop that L2s like Polygon enable for protocols like Aave.

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Photo caption: more users → more data points → more feedback → better products you can build → more users

This feedback loop is crucial for teams building in defi because of how fast the space moves and in turn, how fast protocols need to be able to iterate.

Aave is leveraging this with their launch on Polygon. It took 1.5 weeks after launching for the number of Aave users on Polygon to pass the total number of Aave users on Ethereum. Stani also described how this loop motivates Aave and other teams to create more efficient algorithms to get more users and in turn build better products. This leads to constant competition and innovation amongst protocols. As Stani succinctly summarizes, “Web 3 is a marketplace of algorithms and liquidity.”

Stani speaks. DeFi Pulse hosted an insight-dense AMA with Stani. Based on the total emoji reactions, the highlights for the audience were:

  • On the possibility of getting a home through Aave: Stani sees it “happening quite easily” some day. Check out the full conversation where Stani takes it further and gives an overview of what the process would look like.
  • On Aave’s institutional adoption: Stani says the response has been positive and that they “expect a lot of traction for [their institutional products] especially as DeFi is becoming more and more interesting within the TradFi realm.”
  • On the two-fold reasons the name Aave, ‘ghost’ in Finnish, was chosen: the genesis team's goal is to eventually become a “ghost in the background” while the community leads the protocol, and given the nature of the protocol removing middlemen, the “whole Aave community are ghosts in the ecosystem.”

The conversation was text-based so you can read a full transcript of the back and forth in their Discord channel. Thank you DeFi Pulse!

Water cooler 🆒

$INST Airdrop and Liquidity Mining Program. Instadapp is in the hands of the community! In a blog post, the team launched Instadapp’s community governance along with an initial distribution and liquidity mining program for $INST.

Anyone with an open Aave position, including positions on Polygon, can migrate their positions to Instadapp and receive $INST. Those addresses are then eligible for a 3-month $INST liquidity mining program for maintaining their positions on Instadapp. There are risks users should be aware of but as Stani says, this can be a “Nice tip for all Aave users.”

Aave Grants DAO update 🏗

First round of grants. The Aave Grants DAO, “is a community-led grants program to fund ideas submitted by the Aave protocol’s community, with a focus on empowering a wider network of community developers.” The DAO has been allocated $2 million to fund grants between May 10th and November 10th 2021.

Last week, the initial batch of grant recipients was announced. See below for a brief overview of each project and check out the Aave Grants website for a list of open RFPs. Your project could be listed here next!

L2P.finance | @FinanceL2P | L2P.finance

L2P is a lending platform aggregator that enables audited dApps and protocols to access zero-collateralized loans.

Automated Health Factor Maintenance | @gelatonetwork | gelato.network

The Gelato team is designing an insightful solution to protect Aave users from liquidations by using Gelato Network, a smart contract protocol.

Flipside Crypto | @flipsidecrypto | flipsidecrypto.com

Flipside Crypto will launch Community-Enabled Analytics for Aave placing on-chain analysis tools in the hands of the community and empowering them to produce crowd-sourced insights.

Rabbithole will help bring new users into Aave by designing specific on-chain tasks on Aave and rewarding users for completing them.

Aave Liquidation Notifier | @realstevenli

Aave Liquidation Notifier is a tool to alert users when they are close to being liquidated on Aave, which will allow them to top up their collateral before being liquidated.

Aave Analytics and Growth Dashboard | @OmniAnalytics | omnianalytics.io

Omni Analytics will maintain and create new Dune dashboards to provide a clear picture of the adoption, growth, and challenges faced by Aave.

Aave Meme Contest | @AAVEmemes

Aave Memes is a four-week meme contest led by an enthusiastic community member. We all know deep down that memes = community.

DAO Research Cooperative | @c_spelliscy

The DAO Research Cooperative will share public research that can help Aave on effective DAO operations, including topics relating to legal, taxes, and governance.

That’s a wrap for this week. Check out the relevant community links below if you want to get involved in the Aave ecosystem. If you are building on Aave or have something you think should be shared in the next edition of Aave News, please get in touch with @0xbilll!