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Aave Community Votes To Integrate PayPal’s Stablecoin
Majority of token holders favor onboard PYUSD in AAVE's Ethereum pool, the ongoing vote shows.
Jan 11, 2024, 6:19 a.m.
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Decentralized non-custodial lending and borrowing protocol Aave is voting to onboard PayPal's PYUSD stablecoin issued by Paxos Trust Company.
In an ongoing governance vote, 99.98% of the participating AAVE token holders favor integrating PYUSD into AAVE's Ethereum-based pool. The voting on the proposal, termed temperature check, floated by Trident Digital on Dec. 18, will end later Thursday. The vote follows decentralized exchange Curve's December decision to host PYUSD.
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PYUSD, the dollar-pegged stablecoin, came into existence in August and now has a market capitalization of $289 million, or 0.3% of industry leader tether’s $94 billion.
Aave is a decentralized finance protocol enabling users to lend and borrow funds without an intermediary. Per DappRadar, AAVE is the world's third-largest DeFi solution, with nearly $5 billion worth of crypto assets locked into the protocol.
Trident’s proposal says that AAVE's integration of PYUSD will help build synergies with PayPal's stablecoin and strengthen the relationship between PYUSD and AAVE's decentralized multi-collateral stablecoin GHO.
Trident, which is incentivizing the PYUSD/USDC liquidity pool on Curve, will contribute $5 million to $10 million in liquidity for PYUSD on AAVE from day one, the firm said in the governance proposal chat.
"The idea is to keep yields quite high on Curve. This will create organic borrowing demand for PYUSD on AAVE. So while we don’t intend to provide direct incentives on AAVE we believe our overall incentive strategy will allow for borrowing demand on day 1," Trident said.
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