Aave enables new AMM market

Aave – the decentralized liquidity protocol – has just made it possible for its users to deposit and borrow assets from the Aave AMM Liquidity Pool. Initially, the only LP tokens accepted as security are those from Uniswap and Balancer.

Today, users can deposit and borrow crypto assets from the Aave AMM Liquidity Pool so that the liquidity providers at @Uniswap and @BalancerLabs can use their LP tokens as collateral in the Aave protocol

– Aave (aveAaveAave) March 16, 2021

As a quick refresher, automated market makers (AMM) like Uniswap and Balancer allow anyone to become a liquidity provider and earn a proportional share of the swap fees paid to the pool. Liquidity providers receive LP tokens in return for their provided liquidity. These tokens will incur trading fees over time based on the trading volume of the specified AMM pool.

The Aave AMM market was first established last year with Uniswap V1 LP tokens as a live test case. With the community in great demand for this functionality, the following Uniswap LP tokens will be whitelisted on the Aave AMM market starting today:

  • DAI / USDC
  • DAI / WETH
  • BAT / WETH
  • SNX / WETH
  • UNI / WETH
  • YFI / WETH
  • CRV / WETH
  • MKR / WETH
  • REN / WETH

In addition, there will be 2 Balancer LP pairs that are also on the whitelist, WBTC / WETH and

Depositors of the listed LP tokens can borrow DAI, USDC, ETH, wBTC and USDT via Aave. Chainlink oracles are used to determine the exact value of the LP tokens and the smart contracts associated with the new AMM market have been scrutinized by ConsenSys Diligence.

Keep up to date with Aave by following them on Twitter.

Business development and operations at TrustToken – TUSD. Jack is a startup generalist and DeFi enthusiast. Stay connected with him by following @HHJackSun on Twitter.

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