• Aave (AAVE) has deployed its third version of the protocol (V3) on the Ethereum mainnet.
• V3 introduces new risk mitigation features, improved capital efficiency, and decentralized liquidity.
• The upgrade also focuses on gas optimization, reducing gas costs across all functions by 20-25%.
The decentralized finance (DeFi) lending and borrowing platform Aave (AAVE) has recently deployed its third version of the protocol (V3) on the Ethereum mainnet. This is a major milestone for the platform, as it marks the most significant upgrade to the Aave protocol since its launch in January 2017.
The new version of Aave introduces new risk mitigation features, improved capital efficiency, and decentralized liquidity. In particular, High-Efficiency Mode allows users to increase their capital efficiency when staking or borrowing. Isolation Mode also allows for more assets to be listed on Aave as collateral while keeping the security of the protocol.
The upgrade also focuses on gas optimization. By reducing gas costs across all functions by 20-25%, Aave V3 is able to improve the scalability of the protocol. Additionally, the upgrade was first deployed on Ethereum Layer-2 networks like Optimism, Polygon, Arbitrum, and Layer-1 blockchain Avalanche before being deployed on the mainnet.
The Aave DAO voted unanimously in favor of the proposal to deploy Aave V3 on Ethereum. After the deployment of the upgrade, Aave’s governance token AAVE remained flat. It’s currently trading at $88.12.
Aave founder and CEO Stani Kulechov commented on the new upgrade, stating, “The most exciting aspect of V3 is its flexible design, which enables a variety of new risk mitigation features, and its improved capital efficiency & decentralized liquidity – all while reducing gas costs.”
Overall, the deployment of Aave V3 on the Ethereum mainnet is a major milestone for the platform. With its improved risk mitigation features, improved capital efficiency, and gas optimization, Aave V3 is sure to improve the scalability and usability of the platform.