Aave Labs Unveils Plan to Boost GHO with BlackRock’s BUIDL

• Aave Labs proposes integrating BlackRock’s BUIDL to enhance GHO’s stability and yield.
• Aave’s on-chain activity doubles as the “Skyward” service simplifies DAO governance.

Aave Labs is making waves in the decentralized finance (DeFi) community with its latest proposal to include BlackRock’s tokenized fund, BUIDL, into its GHO Stability Module (GSM).

This strategic approach is projected to dramatically improve the stability and efficiency of Aave’s native stablecoin, GHO, by utilizing traditional financial assets such as cash and US Treasury bills.

The integration of BUIDL into GSM is a vital step in Aave’s larger plan of connecting DeFi to traditional financial markets.

Aave labs just published a tempcheck to introduce the first step towards stronger RWA integration by implementing a version of the $GHO GSM that uses the @BlackRock BUIDL tokenized fund. Exciting development for what will drive the next wave of mass adoption…

— Emilio^ (@The3D_) August 26, 2024

Aave Labs and BlackRock: A Strategic Partnership to Boost GHO’s Stability and Yield 

By converting surplus USD Coin (USDC) stored within the GSM into BUIDL tokens, Aave users will receive monthly dividend distributions in BUIDL, while the underlying assets continue to support the GHO stablecoin.

Beside that, as we previously noted, Aave’s on-chain activity has significantly increased, with active addresses doubling in the last three months. The introduction of Aave’s new service, “Skyward,” aims to simplify proposal navigation for DAO members, further empowering the community in governance.

Furthermore, the integration of BUIDL not only promises to improve capital efficiency, but it also corresponds with Aave’s long-term goal of boosting yield sources through real-world assets (RWAs). This might lead to new partnerships with financial institutions such as BlackRock, while also making GHO more appealing to customers by providing more yield through dividend payouts.

At the time of writing, AAVE, the Aave platform’s governance token, was trading around $131.75, representing a 7.77% rise over the last 24 hours. This favorable result has moved AAVE into the top three gainers of the day, with its market cap almost hitting $2 billion.