Aave

Aave is a decentralized finance (DeFi) protocol that facilitates the lending and borrowing of cryptocurrencies without the need for traditional financial intermediaries. Founded in 2017 by Finnish entrepreneur Stani Kulechov, the project initially launched as ETHLend, focusing on peer-to-peer lending. In 2018, it rebranded to Aave, which means ‘ghost’ in Finnish, and shifted to a liquidity pool model in 2020 to enhance scalability and user experience. The protocol allows users to deposit various cryptocurrencies into liquidity pools, earning interest, while borrowers can obtain loans by providing collateral that exceeds the loan value. Aave supports a wide range of assets and offers features like flash loans, which enable borrowing without collateral, provided the loan is repaid within the same transaction block. In July 2023, Aave expanded its offerings by launching GHO, a decentralized stablecoin backed by collateral deposited within the Aave protocol, aiming to provide a stable and decentralized medium of exchange within the DeFi ecosystem. By August 2025, Aave’s Total Value Locked (TVL) had surged to over $69 billion, capturing more than 60% of the DeFi lending market share. Governance of the protocol is decentralized, with AAVE token holders participating in decision-making processes through a Decentralized Autonomous Organization (DAO), ensuring that the community has a direct influence on the protocol’s development and policies.