• The lending platform AAVE has recently passed a governance proposal to erase its bad debt, which was incurred after an exploit targeting their Ethereum V2 liquidity pool.
• The AAVE token has not responded to the news either positively or negatively, but it has registered small losses in the daily and weekly time frames.
• With the launch of AAVE’s V3 on its mainnet, the crypto might be in a position to reach new highs if the situation permits it.
The lending platform AAVE has been making headlines lately after the successful passing of a governance proposal that aimed to eradicate all bad debt the platform had accumulated when Avraham Eisenberg, orchestrator of the Mango Markets exploit, targeted the platform’s Ethereum V2 liquidity pool back in November 2022. The proposal would use V2’s stablecoin reserve to purchase the necessary number of units of CRV to pay the debt, which was estimated to be worth over $2.5 million at the time of the proposal. This was accepted by the community and implemented on January 25th, proving the liquidity of the protocol.
Despite all the positive news, the AAVE token has not responded either positively or negatively. According to data from CoinGecko, the token registered losses in the daily and weekly time frames, but these losses were too small to revert the token’s gains from the start of the year. Still, with the launch of AAVE’s V3 on its mainnet, the crypto might be in a position to tally new highs if the situation permits it. According to DefiLlama, the crypto is in the top 4 among all platforms, and the Ethereum pool deployment has over $526.52 million total value locked.
Overall, the proposal was successful, and the AAVE platform is looking to have a bright future ahead. With the launch of their V3, the platform is expected to continue gaining traction, and it will be interesting to see just how successful the platform can become. With the current state of the market, the future of AAVE looks promising.