AAVE Protocol Aave Team Announces Future Development Proposal “AAVE 2030”
The five-year plan includes the launch of Aave V4, Aave Network, the introduction of new products, and a rebranding.
Table of Contents
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Rebranding
Aave V4
Cross-Chain Liquidity Layer (CCLL)
Introduction of GHO RWA
Aave Network
Firstly, the Aave team will change the branding of the Aave protocol based on the results of community governance. The previous ghost logo will be replaced with a more minimalist design, retaining only the image of an eye, and the overall design will adopt a more modern style.
AAVE New Brand Identity
Building upon Aave V3, Aave V4 will enhance modularity, optimize capital efficiency, enable dynamic risk allocation, liquidity risk pricing, and more. It will also integrate more fully with other Aave ecosystem products, such as GHO and the new product line below.
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Aave V3 Finally Launches on Ethereum! Introduction to Three New Features, Significantly Reducing Gas Fees
Recommended reason: This article introduces the main exclusive features of Aave V3, including the Portal, which assists users in cross-chain transactions, the E-Mode, which allows users to increase loan-to-value ratios with similar assets, and the isolation mode, which limits the risk of newly listed collateral. This will provide a better understanding of the content of this article.
In addition to the above, the most important architectural change in Aave V4 is the proposal to introduce a unified liquidity layer, abstracting liquidity. This architecture allows for easy addition or improvement of any lending module in the future, such as isolation pools, RWA modules, or CDPs, without the need to change the entire system, thus avoiding liquidity fragmentation issues after protocol updates.
Aave V4 Design Separates Liquidity Pools from Functional Concepts
(Source: Data Source)
Specifically, compared to previous versions, the new liquidity layer of Aave V4 allows Aave DAO to add new lending modules and remove old ones without the need to migrate liquidity. This eliminates the liquidity fragmentation issue that currently exists between Aave V2 and Aave V3 due to version updates.
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For more information on the updates of Aave V4, please refer to the proposal
Content
. The prototype of Aave V4 is expected to be completed by the end of this year, and the complete code is expected to be released in the second quarter of next year. Whether it will go live still depends on subsequent community governance.
Aave V4 New Features Overview
Cross-Chain Liquidity Layer (CCLL)
When Aave V3 was launched in the past, one of the main features was the Portal, which allowed users to significantly reduce cross-chain time by utilizing the liquidity pools existing on different networks. However, this functionality still relied on many trust assumptions and carried certain risks.
With the gradual maturation of CCIP, superchains, and the unified liquidity layer of V4, Aave can become a fully cross-chain liquidity protocol, creating a more secure Cross-Chain Liquidity Layer (CCLL) to replace the existing Portal product. This infrastructure serves as a potential source of income for Aave.
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The Aave team sees their stablecoin GHO as a key tool for introducing RWA to the Aave ecosystem. After the release of Aave V4, the team plans to focus on innovative solutions based on RWA-related products, with GHO as part of the design.
Currently in the ideation stage, the Aave team will collaborate with Chainlink on this feature.
Aave is expected to develop an Aave Network, which can serve as the main hub for Aave and GHO while maintaining a multi-chain service for the protocol.
The team states that the network can be used for various purposes, meeting the common demands of Aave users. For example, the network can serve as the main voting network for Aave Governance V3. It can also be the main hub for Aave’s cross-chain strategy, building existing products on its own app chain.
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Although Ethereum will remain a critical factor in Aave DAO and Aave governance settlement, Aave Network can offer more possibilities and benefits. For example:
Charging using GHO: Through the use of Validium on the Aave Network, economic and efficient micro-payments can be realized to improve user experience.
Integration of Aave V4 liquidity: Integrating Aave V4 liquidity into the network, providing developers with easier access.
AAVE staking: The network can require validators to stake AAVE tokens, increasing the utility of the tokens.
The Aave team will monitor the technological developments of future L1 and L2 networks before deciding on the implementation of the Aave Network.
Aave
Aave Governance V3
Aave Network
Aave V4
GHO
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