Launched in November 2017, previously known as ETHland, Aave is a decentralized lending pool protocol founded by Stani Kulechov. It is an ecosystem of smart contracts running on top of the Ethereum blockchain. It utilizes it’s native token best known as the Aave Coin or just Aave.
The token powers Aave’s two in-house finance markets, the Aave market and Uniswap market. Users can deposit, borrow, repay, redeem, liquidate, do a flash loan or swap tokens with the lending pool reserves.
Using decentralized on-chain governance the Aave protocol allows multiple lending pools with separate liquidity parameters, permissions and type of assets. Its token controls the rights of the protocol for borrowers in a money market.
There is a total supply of 16,000,000 Aave Coins
The interest rate for the money market accounts is based on how much funds are available in the lending pool at any given time. If the amount of funds decreases, the interest rate increases.
Lenders earn interest on their deposits into the lending pool. The interest rate charged on borrowers determines the earning rate. The Aave algorithm protects the liquidity reserves to guarantee withdrawals.
Yes, Aave Coin is a good investment. It has a solid real-world use case. From February 2020 to February 2021 it grew by approximately 98,000%. This may not be the case going forward, considering that it is maturing, however, it has strong prospects of continuing to grow. Analysts at Rateweb predict that the coin will reach $10,000.00 (R150,000.00) by 2025.
Most South African based cryptocurrency exchanges have not yet listed the Aave Coin as they have with the Bitcoin, you can, however, buy it via different wallets like MetaMask and Coinomi. Alternatively, you can buy it on international exchanges like Coinbase, Binance, Gemini and Kraken.