Ready. Set. GHO.
Aave Companies is moving ahead to launch its new decentralized stablecoin, that will be native to its Aave Protocol, on the Ethereum mainnet.
Aave said in a release that its new stablecoin (the name is pronounced “go”) is designed to offer more transparency for users and will be minted through an array of collateral assets held by users across the Aave Protocol. By making use of this mix of assets, Aave says it will offer more flexibility to its users.
Right now, Aave already has pools that users can access for 30 Ethereum-based tokens, including other stablecoins like Tether and USDC. It also offers pools that count real-world assets, like real-estate, that can be tokenized for purchase or held as collateral.
A stablecoin is an entirely digital token that draws its value from its peg to a fiat currency or other asset. For Aave, issuing a stablecoin is meant to improve accessibility for users across its ecosystem at lower cost and improve efficiency within its market.
Aave's Stani Kulechov: What Sets Our GHO Stablecoin Apart
Aave co-founder Stani Kulechov feels more optimistic than ever that the $5 billion DeFi lending protocol's upcoming stablecoin GHO (pronounced "go" like ghost, the project's mascot) will solve real world payment problems. “I think it's a big issue, because just going back a couple of months ago, I was visiting Buenos Aires, Argentina, and stablecoins are actually used to preserve value and transact,” he said on the latest episode of Decrypt's gm podcast. “So for example, the national currency i...
The idea of launching GHO first emerged through a proposal to the Aave DAO in June 2022. After receiving the community’s approval to go ahead, it was deployed in February to the Ethereum Testnet, a network used by developers to tinker with their protocols ahead of being deployed.
GHO differs from some of its stablecoin peers, like MakerDAO's DAI, in the way it can be minted through the deposited collateral. Unlike DAI which requires separate vaults for each asset used for minting, different types of GHO collateral can be deposited in one transaction.
True to its decentralized nature, Aave’s DAO will be responsible for adjusting interest rates, setting mint caps, and governing who will be allowed to mint GHO based on a set of predetermined conditions.
Ready to GHO? Aave Launches Native Stablecoin on Ethereum Testnet
Aave Companies, the firm behind the eponymously-named lending and borrowing protocol, are launching its native stablecoin GHO on the Ethereum Goerli testnet. Pronounced “GO,” the stablecoin is fully decentralized and over-collateralized. Its design ensures the GHO oracle price is always fixed one-to-one with the U.S. dollar, as minting will be through assets supplied as collateral in the Aave Protocol. Aave is a decentralized lending and borrowing platform that uses over-collateralization as a m...
Minting will also be enabled by a set of users Aave calls “facilitators,” which go through an approval process from the Aave DAO to get this status. Depending on their class, a facilitator will have the ability to mint up to a certain amount of GHO, or offer redemptions between GHO and other assets.
Currently, the company only intends to launch GHO on Ethereum's mainnet, but the company said it would submit a multi-chain plan to the rest of the community for approval. Specifics weren’t available at the time of writing.
