Aave Protocol launches stablecoin GHO on Ethereum mainnet, $2 million mined

Decentralized finance (DeFi) protocol Aave has launched its algorithmic United States-dollar pegged stablecoin GHO on the Ethereum mainnet, with $2.19 million worth of GHO mined to date.

Aave announced the launch of the new stablecoin in a July 16 blog post, describing the new stablecoin GHO as a “decentralized, hyper-collateralized” asset. The stablecoin is backed by a “multitude” of digital assets, including Ethereum’s native currency Ether (ETH) and Aave’s native token AAVE (AAVE).

Come on GHO! congratulations to @AaveAave Community at mainnet launch. https://t.co/vI7JbMLYb4

— GHO (@GHOAave) 15 July 2023

The launch of GHO on the mainnet follows a community governance vote, in which nearly 100% of the 424 participating addresses voted in favor of the new stablecoin.

Unlike centralized stable coins such as Tether’s USDT (USDT), which has drawn some criticism for its apparent lack of transparency around its reserves – according to Aave, the assets backing GHO are transparent and verifiable by on-chain data. This can be confirmed.

“All transactions are conducted through self-executing smart contracts, and all data related to GHO transactions is available and auditable directly from the blockchain or via multiple user interfaces,” Aave wrote.

Additionally, Aave said that GHO revenue would further increase its DAO treasury, with governance being handed over to Aave and stkAAVE token holders.

The GHO stablecoin is currently available to the public:

“Anyone can create GHO using assets supplied as collateral in the Aave Protocol V3 Ethereum market, thereby ensuring that GHO is collateralized over multiple assets.”

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The launch of GHO marks another addition to the growing ranks of DeFi-native algorithmic stablecoins. On May 4, DeFi protocol Curve launched its flagship algorithmic stablecoin crvUSD.

At the time of publication, MakerDAO’s Ethereum-based stablecoin DAI is the largest algorithmic stablecoin in circulation, with a market capitalization of $4.28 billion. statistics From DeFiLlama.

However, the overall stablecoin market remains dominated by centralized issuers including Tether and Circle.

Currently, Tether’s USDT and Circle’s USD Coin (USDC) account for 87% of the total circulating supply of all US-dollar pegged stable coins.

As per the price at the time of publication, GHO is trading at $0.9927, slightly below the desired $1 peg and has fallen to $0.9814 on July 16. statistics From Coinmarketcap.

Cointelegraph reached out to Aave for comment but did not yet receive an immediate response.

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