Aave crosses $1T in lending as it seeks more bank, fintech integrations

Decentralized finance protocol Aave has surpassed $1 trillion in cumulative lending volume, marking a historic first in the DeFi industry.

“A decade ago, DeFi and Aave didn’t exist. They were just ideas. Today, Aave stands as the backbone of onchain lending, powering a new financial system that is open, global, and unstoppable,” Aave Labs CEO Stani Kulechov said in an X post on Wednesday.

The feat marked another step toward Aave’s goal of becoming the “largest, most efficient liquidity network in the world,” Kulechov added. “One that builders, banks, and fintechs plug into by default, fundamentally improving liquidity and cost structures across global finance.”

Source: Aave

In August, Aave Labs launched Aave Horizon, a new lending market on Ethereum, specifically for traditional finance firms and other institutional investors to borrow stablecoins against real-world assets.

VanEck, WisdomTree and Securitize were among the first participants to use Aave’s institutional offering.

On Feb. 15, Kulechov said DeFi lending could benefit from tokenizing “abundance assets,” like solar, batteries for energy storage and robotics for labor. He expects those assets to be worth a combined $50 trillion by 2050.

Kulechov originally launched Aave as ETHLend in November 2017 before rebranding to Aave in September 2018. It now secures over $27.2 billion in total value locked, enabling users to earn interest on deposits and borrow instantly using crypto as collateral.

Aave leads several prominent DeFi lending platforms in TVL, such as Morpho, JustLend, SparkLend, Maple, Kamin Lend and Compound Finance, each of which holds over $1 billion in total value locked.

Aave has generated over $83.3 million in fees over the last 30 days, nearly four times that of its next-closest competitor, Morpho.

DAO proposal has caused division within Aave community

Aave’s milestone comes amid a protocol-wide feud over how much funding and revenue control Aave Labs should receive versus Aave’s decentralized autonomous organization.

Aave ($AAVE) token holders have been asked to approve a package worth up to $42.5 million in stablecoins and 75,000 $AAVE for Aave Labs.

In return, Aave Labs would route all revenue from Aave-branded products to the Aave DAO treasury under a DAO-funded operating model.