tl;dr
Since April, decentralized finance (DeFi) protocols have added about $49 billion in net total value locked (TVL), with Aave contributing approximately $15 billion, or 31% of this growth. Aave enables users to lend and borrow cryptocurrencies without intermediaries, offering dynamic interest rates ba...
Since April, decentralized finance (DeFi) protocols have seen a remarkable surge, adding approximately $49 billion in net total value locked (TVL). Aave, a leading DeFi platform, has been a major driver of this growth, contributing around $15 billion, which accounts for roughly 31% of the total increase in DeFi TVL during this period.
Aave stands out by consistently delivering significant value; for every $10 billion added to DeFi TVL, it has contributed about $3 billion. This platform enables users to lend and borrow cryptocurrencies like stablecoins, Bitcoin, and Ethereum without traditional intermediaries. By providing assets to liquidity pools, users earn interest while borrowers access funds via collateral. The interest rates dynamically adjust based on supply and demand.
Earlier this month, Aave announced it became the first DeFi lending protocol to surpass $50 billion in net deposits, fueled by a sustained on-chain market rally since late October 2023. Since launching its permissioned Aave Arc protocol in 2021—which incorporates KYC and anti-money laundering compliance for institutional investors—Aave has continued expanding. Notably, the Arc protocol was utilized in Project Guardian overseen by Singapore’s central bank to tokenize assets.
In March, Aave unveiled its Horizon initiative aimed at boosting real-world asset adoption within DeFi. This forward momentum coincided with a strong market rally, lifting Aave’s native token, AAVE, above $330, reflecting a 36% increase over the past month.
Stepping into centralized blockchain deployments, Aave is preparing to launch a licensed version of its lending service on Kraken’s Ink blockchain. This plan received overwhelming 99.8% community support through an ARFC vote and is set to progress via a DAO on-chain vote through an AIP. The approach involves whitelabeling Aave v3 for the Ink Foundation to accelerate institutional adoption of on-chain lending.
The ARFC highlighted that this strategic move will broaden Aave’s technological reach, unlock new revenue streams, and generate fees from borrow volumes corresponding to a 5% reserve factor. The Ink Foundation has committed to funding the protocol’s development, signaling a robust partnership designed to drive innovation at the intersection of DeFi and institutional finance.