cryptopotato.com
Over the weekend, the Aave DAO successfully launched the $GHO stablecoin on the Ethereum mainnet.
The dollar-pegged stablecoin was proposed in July 2022 as a way to allow users to mint $GHO by supplying crypto collateral to Aave v3 in a similar system to MakerDAO’s $DAI.
The Aave DAO has successfully launched @GHOAave on the Ethereum Mainnet. Congrats to the Aave community on this historic moment! pic.twitter.com/Br3QGqMU8X
— Aave (@AaveAave) July 15, 2023
$2.2 Million $GHO Minted
The team said $GHO was slightly different from other stablecoins because repaid interest on it is redirected to the Aave DAO treasury, adding:
“This supports the sustainability of the protocol and the ongoing development of new features.”
It added that AAVE token stakers would get a discount for minting $GHO. According to the official website, 2.2 million have already been minted on Ethereum. However, at the time of writing, the stablecoin was trading just below its peg at $0.992, according to CoinGecko.
Aave explained that minting $GHO requires “Facilitators” that are approved and governed by Aave Governance. “Governance-approved facilitators will be able to mint up to a specified amount of $GHO agreed upon by the DAO,” it added.
Furthermore, the multi-collateral token can be minted with any collateral on the Aave v3 protocol.
Aave’s native token of the same name was trading flat on the day at $77.51 but has gained 10% over the past week.
$GHO is entering an already crowded stablecoin market, with one player commanding the lion’s share of it.
Stablecoin Ecosystem Outlook
The stablecoin market is currently worth around $128 billion, which represents about 10% of the total crypto market capitalization.
Tether is the dominant player with a 65% market share and $83.7 billion $USDT in circulation. Its supply has grown by 27% since the beginning of 2023 as its U.S. treasury collateral has made a steady income.
Tether is printing!
You know what that means!👀#Bitcoin #$USDT pic.twitter.com/cmoVKHsDHP
— Crypto Rover (@rovercrc) July 16, 2023
Conversely, rival stablecoin issuer Circle has seen its supply of $USDC decline by 38% over the same period as regulatory pressure in the United States mounts.
$USDC has a market share of 21%, with $27.3 billion in circulation. The third largest stablecoin in the market is $DAI, with $4.3 billion.