How does AAVE work?

Aave uses liquidity pool infrastructure too. As opposed to Uniswap’s “trading pools,” Aave establishes “l ending pools .” Like Uniswap, Aave goes beyond the P2P (peer-to-peer) model and uses something more akin to P2Pool2P — peer to pool to peer. In Aave, users — the lenders — can deposit cryptocurrency, for example DAI, into an Aave lending pool .

What is AAVE lending?

It was founded by Stani Kulechov in 2017 as a crypto lending platform that used a Pier-to-Pier system to match borrowers with lenders. This was not an automatic system and did not work due to a lack of liquidity. So in 2018, it was renamed Aave and in January 2020, it was released on the Ethereum blockchain as a DeFi lending protocol.

What is the value of AAVE?

Aave is valued for its technical capability, utility, and features. However, the value of Aave is also defined by its supply, which is limited to 16 million AAVE. The Aave system uses the money paid in fees to buy AAVE and remove it from the circulating supply. That way, Aave is burned and the supply is gradually reduced.

What does AAVE stand for?

AAVE stands for African-American Vernacular English and is occasionally referred to as Ebonics, or speaking with a “blaccent". AAVE is essentially a partially spoken vocabulary in urban communities and is claimed to have been created by African American communities and Black Canadians.