Decentralized finance protocol Aave has over $21.000 billion in liquidity, concentrated primarily in its Aave V2 version and its integration with Ethereum's scaling protocol Polygon.
Aave, an open-source decentralized liquidity protocol, built on the blockchain de Ethereum to offer loans with cryptocurrencies, , has a total liquidity of 21.487 million, at the time of this edition.
As shown by his web portal, the decentralized lending protocol doubled its liquidity in the last month, becoming the number one protocol in decentralized finance ecosystems (DeFi) currently. By early May, Aave’s liquidity, or total value locked (TVL), was close to $11.000 billion, growing by more than 90% in the past 30 days.
It may interest you: 0x Protocol is now available on Polygon to add liquidity to the protocol
Nearly $8 million on Polygon
Aave is a relatively new DeFi protocol, with just over a year of experience within these ecosystems. Still, the growth and adoption that Aave has had have been surprising, to the point of leading the decentralized ecosystem by locked capital.
The implementation of Aave on Polygon, which has been in place for just over a month, is also surprising for its impressive growth. At the time of writing this note, Aave Polygon has a TVL higher than the 7.920 million.
Aave announced its integration with Polygon, Ethereum’s scalability and interoperability protocol, on March 31, noting that this union would help it explore the new frontiers of scalability that the protocol offers.
Marc Zeller, Aave’s integrations lead, noted that the decentralized lending protocol came of age during the “DeFi summer” of 2020, when it sparked a frenzy for these ecosystems, but that with the integration of Polygon it would take a major step towards true scalability and inclusion, allowing its decentralized financial services to be equally accessible to everyone again.
Let us remember that the current Ethereum faces serious scalability problems and high gas costs, which make it impossible for many users to access applications and decentralized ecosystems based on this network, due to high commission rates.
The solution is in layer 2
To scale DeFi, and make decentralized finance fulfill its mission of “finance for all,” Zeller highlighted layer 2 implementations as the solution to scaling issues and high costs.
One such layer 2 implementation is Polygon, a scalable Ethereum sidechain that offers fast and nearly free transactions, and allows protocols to enjoy a high level of security and performance. Polygon is the first implementation of Aave’s new “New Frontiers” approach, which seeks to create synergies to explore solutions that overcome the current scaling and performance problems experienced in Ethereum.
In addition to Aave, this scalability protocol has been integrated with several DeFi protocols, such as 1inch, Sushi Swap, chainlink, 0xProtocol, among others, and has more than 250 decentralized applications (dApps) built on top of each other. And as Zeller said, more decentralized protocols will continue to look to highly scalable and interoperable second-layer projects like Polygon for solutions.
Continue reading: Polygon SDK, the solution to boost Ethereum as a complete multi-chain system
