Aave’s Ambitious Expansion: Integrating with BNB Chain, Starknet, and Polygon zkEVM

In the Brief:

  • Aave is looking to expand its reach to other blockchain ecosystems, with a temperature check vote initiated to deploy Aave V3 on Starknet and the recent endorsement to deploy on Polygon zkEVM mainnet.
  • Aave is also proposing to deploy Aave V3 on BNB Chain to enhance growth and collaboration between the Aave and BNB Chain communities.
  • Aave V3 introduces new features and optimizations, including implementing more sophisticated risk management tools and parameters.

3 - 5 minute read

DeFi lending leader Aave is actively pursuing opportunities to broaden its footprint across diverse blockchain networks, emphasizing the protocol’s expansion and adaptability. Aave V3 represents the third major iteration of the Aave protocol, a decentralized and non-custodial liquidity market protocol. The protocol enables users to lend, borrow, and accrue interest on various crypto assets, encompassing stablecoins and other tokens. The protocol is governed by its community through the AAVE token, which is used for voting on proposals and updates.

On Monday, a temperature check vote was initiated to deploy Aave V3 on Starknet, with voting concluding on April 11. The proposal details a two-stage integration process between Aave and Starknet. The first phase, which centered on establishing a cross-chain bridge between Ethereum and Starknet, has already received community approval. The proposal seeks to finalize the second phase by fully implementing the Aave protocol on Starknet. Polygon zkEVM and Starknet are zero-knowledge rollup networks, conducting off-chain computations on a secondary layer for swifter, more cost-effective transactions while focusing on security.

The Aave community has also endorsed deploying the Aave V3 minimal viable version on the recently-launched Polygon zkEVM mainnet, which was approved during the temperature-check phase. The accepted proposal advised restricting asset inflows and implementing conservative risk parameters, allowing development and risk service providers to analyze the zkEVM network comprehensively. To mitigate risk, the proposal recommends including only three collateral types — WETH, WMATIC, and USDC — and one lending asset, USDC.

Aave-Chan Initiative founder Marc Zeller has proposed deploying Aave V3 on BNB Chain. The expansion aims to grow Aave’s presence further, tap into the Binance-associated blockchain’s user base, and add revenue. “This deployment aims to enhance the growth and collaboration between the Aave and BNB Chain communities, providing new opportunities for both ecosystems,” the proposal states. If approved, Aave V3 will deploy on BNB Chain and allow BNB, WBTC, BETH, WETH, USDC, and USDT as collateral.

Before Aave V3 can be deployed on BNB Chain, feedback and input will be gathered from the Aave community — particularly regarding the proposed risk parameters and technical deployment details. Consensus must also be reached, and the proposal must be finalized and put to a governance vote.

The Aave community’s active pursuit of opportunities to broaden its footprint across diverse blockchain networks is a testament to the protocol’s expansion and adaptability. With Aave V3 available on several blockchain networks, including Ethereum and Optimistic Rollup-based Layer 2s, such as Arbitrum and Optimism, the Polygon POS sidechain, and three Layer 1s: Avalanche, Harmony, and Fantom, the protocol is positioned for continued growth and success.

For traders, the expansion of Aave’s presence across different blockchain networks means greater access to liquidity and more opportunities to lend, borrow, and accrue interest on various crypto assets. However, it is important to note that trading carries high risk, and traders should consult with financial advisors before making any investment decisions.

Disclaimer: The content in this article is provided for informational purposes only and should not be considered as financial or trading advice. We are not financial advisors, and trading carries high risk. Always consult a professional financial advisor before making any investment decisions.

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