Aave doubles in three days, now secures $1.26 billion in total value locked

Aave doubles in three days, now secures $1.26 billion in total value locked

Author: Alchemy Team

Reviewed by Brady Werkheiser

Published on August 20, 20203 min read
Aave alchemy poster.
Aave's infrastructure is supercharged by Alchemy Supernode.

Alchemy is thrilled to congratulate Aave on becoming the second DeFi protocol to reach $1 billion in total value locked. Aave grew from $529 million to $1.26 billion in one week, an insane increase supported by the Alchemy developer platform. In fact, since switching to Alchemy, Aave has gracefully scaled 3000x. 

  • Aave are the mad geniuses behind Flash Loans.

  • They recently published Aavenomics, their long-term vision for growth.

  • Their favorite product is Alchemy Monitor for the crucial insights and instant feedback.

Aave is a decentralized lending and borrowing marketplace, a money market created because access to capital is something everybody needs. Aave’s founders saw an opportunity to provide this access in a way that hadn’t been done before by building on Ethereum using smart contracts. Now, with nothing more than an Ethereum wallet, people can use Aave to connect, deposit, and borrow -- a major step forward for the decentralized economy.

Aave’s founders are longtime Ethereum supporters, and they launched their platform in 2017. In its early days Aave focused on peer-to-peer lending, but ran up against limitations related to scaling, user comfort, and yield. “The overall experience was limited and not as efficient with the peer-to-peer platform,” says Aave CEO Stani Kulechov.

The founders were not discouraged. They discovered that by aggregating funds and securities across many users through lending pools, they could establish stability and liquidity that would enable Aave to scale to meet the needs of millions of people. 

Aave is driving the future of DeFi

Now, with DeFi exploding in popularity, these years of continuous work and market feedback has put Aave at the front of the DeFi pack. Aave has already made a name for itself by bringing Flash Loans to market, which allow people to borrow with no collateral as long as the borrowed amount is returned before the end of the transaction. There is no custodial equivalent to Flash Loans. The Aave team created this novel innovation by applying the Ethereum toolkit in a unique way.

Most recently, Aave laid out its vision for Aavenomics, its framework for the platform’s economic incentives, governance, and total token supply. Aavenomics is designed to be dynamic and improvable, with a goal of maintaining and strengthening the platform’s safety and sustainability over time. The model represents an important milestone and reflects the platform’s maturity and expanding ambitions.

The Aave team has a big vision and already has huge traction, but they know that certain core functionality will be essential to the project’s long-term success. A top-performing protocol, UI, and UX are all essential to capturing growth in the DeFi space, and this is where Alchemy makes an impact. 

Alchemy is supercharging the growth of DeFi

Alchemy Supernode, our supercharged Ethereum API, provides the reliable and scalable infrastructure that allows Aave’s developers to meet their users’ needs while focusing solely on  core products. Aave managed to sensibly reduce their downtime with Supernode despite growing total dollars locked by over 3,000x since the beginning of the year.

Adaptability will also be crucial to success. With Ethereum and DeFi growing and changing so rapidly, Aave must be nimble enough to respond instantly to changes in the market. Through its partnership with Alchemy, the team is well positioned on this front. “Alchemy’s UI offers crucial insights,” says Kulechov. “If we make a change, we can easily track whether it’s good or bad and adjust dynamically based on this feedback.”

Aave uses the Alchemy Monitor suite of dashboards and alerts to check app health, performance and user behavior. Soon, Aave can leverage features such as history of balances and other data aggregations to help developers build on the protocol as seamlessly as possible. 

Alchemy is helping Aave bring finance to everyone

DeFi’s current growth reflects investors’ demand for financial instruments that offer fairer and more robust ways to build wealth. Now, Alchemy is helping Aave and other projects built on Ethereum supercharge this growth by performing key functions reliably, at scale, in a way that’s easy to use. “The underlying idea is so powerful,” says Kulechov. 

DeFi is taking the world by storm, and Aave is one of the top projects pushing the space forward. Their explosive growth over the past year reflects the quality of the platform and the team’s expertise and adaptability in a crowded, rapidly evolving marketplace. Alchemy is proud to provide key infrastructure -- around scalability, analytics, UI, and UX -- that allows the Aave team to focus its efforts on the financial innovation that has made it so successful to date.

Calling all devs

Crazy for lending protocols? Aave is hiring.

Want to chat with Alchemy and Aave devs? Join our discord.

Ready to build the next killer app? Get started free with Alchemy.

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