Aave v2 launches liquidity mining program targeting stablecoin borrowers
April 27, 2021. Summarized by summa-bot.
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Aave’s new liquidity mining program will offer double-digit rewards to v2 users who borrow stablecoins.
Aave has launched liquidity mining incentives for its v2 protocol, paying out governance token rewards exceeding 20% to users who borrow stablecoins.
The liquidity mining program was passed through a governance vote on April 24, with 2,200 staked AAVE (stkAAVE) set to be distributed to lenders and borrowers until July 15, worth roughly $880,000 at current prices.
Aave said they wanted to reward stable tokens more to discourage risky borrowing and boost stablecoin liquidity.
With roughly 40% of Aave’s TVL still locked in its version one iteration, the v2 rewards campaign is also intended to migrate users to its updated protocol.
“By introducing liquidity mining rewards only on Aave v2, liquidity providers and borrowers will naturally migrate toward the optimized version,” Aave said.
The program follows the success of liquidity mining rewards incentivizing users to explore Aave’s deployment on Layer-two scaling solution, Polygon (previously known as Matic).