One of the co-founders of Aave, Stani Kulechov, has stated that Aave plans to become a powerhouse in the world of decentralized finance (DeFi).
Aave, a prominent participant in the decentralized finance (DeFi) space, has seen a more than double increase in its total value locked (TVL) over the past year, reaching $11 billion. Due to this surge, Aave has surpassed MakerDAO as the third most valuable DeFi project. During a recent interview, Stani Kulechov, Aave’s co-founder, recently disclosed that the platform is transitioning into a seamless “DeFi supermarket.”
With numerous new products and services, Aave is broadening its ecosystem. One is the stablecoin GHO, designed to function as a dependable reserve of value during volatile periods.
Additionally, it has introduced a crypto wallet named Family, intended for those new to the crypto industry. Additionally, DeFi enthusiasts are attracted to Aave’s Lens Protocol, a social media network fueled by ZKsync’s technology stack. It is important to note that the Lens Protocol is raising $50 million from investors.
Avara, a new parent corporation headquartered in London, has consolidated these ventures. Kulechov envisions Avara as a comprehensive solution that caters to the needs of both novice and seasoned crypto devotees and meets all DeFi requirements.
Kulechov asserted that “social capital is present in every individual on Earth, regardless of their language, nationality, or geographic location.” “If we can resolve the concept of owning what is yours online, it will fundamentally unlock additional value.”
Drew Osumi, the co-founder of Number Group, a venture studio, is confident that Aave’s most recent endeavor will provide a user-friendly solution for newcomers. He asserts:
“It feels like the grand plan is to be a permissionless and decentralized Meta, where users are actually valued at market value.”
Market Competition
Aave’s expansion has heightened competition with other DeFi initiatives. Since the initial coin offering (ICO) era in 2017, Aave and MakerDAO have been fundamental to the DeFi ecosystem. The two entities have occasionally collaborated on various occasions despite their competition.
The introduction of stablecoins further exacerbated the competition. MakerDAO’s DAI, the oldest decentralized stablecoin in DeFi, is currently in direct competition with Aave’s GHO, which was introduced in July 2023.
Lito Coen, the director of growth at Socket Protocol, provides his perspective:
“GHO makes a lot of sense, especially when one of the biggest overcollateralized stablecoins directly launched a competitor with Spark.”
Furthermore, in 2023, MakerDAO implemented its lending protocol, Spark, to intensify the competition. Aave’s novel revenue generation model has demonstrated exceptional efficacy. Charging fees for borrowing, lending, liquidating loans, and making deposits have generated approximately $101.7 million in revenue in the past 30 days. In the interim, AAVE, Aave’s native token, is trading at roughly $77.4, representing a more than 6% increase in the past few hours.