Aave V3 Goes to Market on Ethereum

Last March, Aave launched V3 on a series of networks: Polygon, Arbitrum, Optimism, Avalanche, Fantom, and Harmony. Now V3 finally comes to Ethereum, where users have been migrating capital from V2 and taking advantage of the V3’s Efficiency Mode to boost yield. So far, 50% of deposits have migrated with WETH and wstETH being the most popular tokens to move to V3. And with higher capital efficiency for correlated assets, borrowers can achieve higher returns by using wstETH as collateral to borrow ETH for juiced staking yields. With governance smartly considering more liquid staking derivates as accepted collateral, Aave V3 on Ethereum is taking advantage of one of crypto’s hottest narratives.

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