Aave DAO, the governance body for the Aave DeFi protocol, voted in support of a proposal to create a stablecoin called GHO.
The Snapshot vote, which ended today at 06:00 a.m. EDT, passed with almost unanimous approval from the DAO. Data from the voting page shows DAO members with a total of 501,000 AAVE tokens were in favor of the proposal. This amounted to 99.99% of the total votes cast during the three-day polls.
With the vote passed, the next step will be to implement the creation of the GHO stablecoin via a new Aave improvement protocol (AIP). The DAO will be in charge of administering the stablecoin upon its creation.
Aave users looking to mint GHO can do so by supplying any of the crypto tokens accepted as collateral on the platform. Apart from acting as collateral, these deposits will also earn yield on Aave. The protocol will charge interest on GHO stablecoin loans taken by borrowers.
Aave plans for GHO to function as an overcollateralized stablecoin similar to MakerDAO’s dai (DAI). This means that the value of crypto deposited will exceed the amount of GHO tokens minted. Aave founder Stani Kulechov previously said that the project will look to drive organic adoption for GHO on Ethereum’s Layer 2.
By creating a stablecoin, Aave is set to join a select group of DeFi stablecoin issuers alongside MakerDAO. This list might soon include Curve Finance, another DeFi primitive, based on reports from earlier in the month.
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