Blockchain Technology is bringing revolutionary changes in the financial world. It has provided facilities like savings, loans and investment for people without being dependent on traditional banking and intermediates. This revolution is called Defi (Decentralized Finance). The purpose of Defi is to make finance more open, transparent and available for all. In this ecosystem, platforms like Aave have made new innovations in the world of loan and lending. Without a bank or middleman, anyone can give or take on Aave on Aave on a digital digital assets loans. Today Aave has become an identity of Defi growth, not just a protocol.
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What is Aave?
Aave is the word of Finnish Language which means ghost, which reflects the philosophy of its fast and invisible manner. Aave is an open-source and non-custodial lending protocol that allows users to take and give cryptocurrency loans. It is a smart contract based platform, that is, every transaction is based on the regulations of the blockchain, without any third party interfensions. If you Aave Worth If you want to know, click on this link.
How is Aave used?
People interact in two ways on Aave’s platform:
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Lender: Users who deposit their cryptocurrency on Aave platform. In return, they get interest.
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Boror : Users who borrow cryptocurrency from the platform. For this, they have to give some collateral.
Aave’s system works on liquidity pools, where users deposit their assets and borrow from borors in pools from the other side.
Major features of Aave
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Flash Loans: Ultra-short term loan without collateral, which is to be repaid within the same transaction.
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Fee switching: Users can switch between fixed and floating interest rates.
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Cross-chain lending: Aave gives lending -ports on multiple blockchain networks such as Ethereum, Polygon, avalanche.
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atokens: Lander gets atokens in exchange for depositing, on which interest is available over time.
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Governance: Changes in Aave Protocol and upgrade are given by voting by Aave token holders.
What is Aave token?
Aave is a native token of Aave. It is used for many purposes:
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Voting in governance: Aave holders can vote for a decision related to the governance of the protocol.
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Discount in fees: Aave holders get discounts in some special services.
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Safety module: Aave the security pool of the protocol can be supported by stake and rewards are found in return.
Why is Aave special?
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Reliability: Aave Defi is one of the oldest and reliable project of space.
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Innovation: Facilities like flash loan have revealed new possibilities throughout the Defi industry.
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Diversity: Apart from Ethereum, its services are also available on networks like polygon and avalanche.
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Safety features: Aave has a safety module and review mechanism to reduce liquidity risk.
Conclusion
Aave has proved that finance cannot be limited only to big banks and institutions. Even if a normal user is available to the right technology, then he can also get a financial freedom. Aave has become a strong and reliable name in the world of Defi. If you want to be a part of Crypto and Finance Future, then understanding and using Aave can be a great start for you.
Also read:Know what is synthetic superintelligence alliance
