Aave DAO Votes For Proposal To Launch GHO Stablecoin

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Aave DAO, the governing body of the Aave DeFi protocol, in the vote that ended today, voted in favor of a proposal from Aave Companies to the DAO for the introduction of GHO.

In the three-day voting process, the GHO stablecoin proposal was supported by 99.99% of all voters (501,000 AAVE token holders).

The GHO will be managed by Aave governance through an AIP and 100% of the interest payments on GHO loans will also be sent to the AaveDAO. However, it is up to the AaveDAO to decide whether it will support the Aave companies for the costs and work on the GHO.

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Mining the GHO stablecoin on Aave

After community approval, GHO stablecoin will be launched on the Aave protocol. Users of the Aave protocol can strike the GHO stablecoin against a wide variety of crypto assets. In addition, those borrowing GHO will also continue to earn interest on their underlying collateral provided.

Aave users have the freedom to deposit any cryptocurrencies accepted on the platform as collateral for minting the GHO stablecoin. In addition to the deposits that serve as collateral for minting GHO stablecoin, the deposits will also provide returns for the Aave borrowers taking out GHO stablecoin loans.

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Like MakerDAO’s DAI, Aave wants the GHO to be an over-collateralized stablecoin, meaning more GHO tokens will be created compared to the value of the deposited cryptocurrencies.

Earlier, Aave founder Stani Kulechov stated that they would try to promote the organic adoption of the GHOstablecoin on Layer 2 of Ethereum.

By approving the proposal to launch the GHO, Aave has effectively set itself on the path to joining MakerDAO and other DeFi stablecoin issuers in launching stablecoins. Another protocol that has expressed the intention to launch a stablecoin is Curve Finance.

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