Decentralized finance (DeFi) lending protocol Aave announced that Aave V3 has been deployed on the ZKsync Era Mainnet, bringing improvements in scalability, privacy, and security. This development aims to broaden the DeFi user base and open up new opportunities for institutional use cases.

ZKsync represents a Layer 2 protocol designed to facilitate scalable and low-cost payments on Ethereum, using zero-knowledge (ZK) rollup technology to achieve this. Developed by Matter Labs, it is a user-focused platform that operates without requiring trust, ensuring secure and efficient transactions.

This latest development will advance the Elastic Chain ecosystem by introducing liquidity and yield generation features. In addition, Chainlink will supply secure and reliable price feeds.

Following a successful evaluation conducted by BGD Labs and a favorable risk assessment by Chaos Labs, along with asset and parameter recommendations from risk service providers, BGD Labs proceeded with the deployment. The Aave DAO has greenlighted USDC, USDT, WETH, and wstETH as the first assets on Era Mainnet.

Furthermore, the Aave Chan Initiative (ACI), serving as a delegate and service provider for Aave DAO, will manage GHOAve incentives on behalf of the DAO. ACI will allocate airdrops from the ZKsync ecosystem through various channels, encompassing liquidity incentives, safety module deployments, and Merit programs.

Aave V3 is debuting on Era Mainnet, powered by @zksync, unlocking unprecedented scalability, privacy, and security while expanding the DeFi user base and new institutional use cases. pic.twitter.com/blNlUjsalX

— Aave Labs (@aave) August 21, 2024

Aave Protocol V3: Enhancing DeFi With Improved Efficiency, Security, And Cross-Chain Functionality

The Aave Protocol functions as a decentralized, non-custodial liquidity platform that enables users to engage as suppliers, borrowers, or liquidators. Suppliers contribute liquidity to the market and generate interest on the cryptocurrency assets they offer, while borrowers have the option to access loans in an overcollateralized manner. Additionally, borrowers can use one-block borrow transactions, known as “flash loans,” which do not require overcollateralization.

Aave V3 builds upon its foundational features, such as aTokens, instant liquidity, stable rate borrowing, as well as credit delegation, by introducing several enhancements. V3 offers improved capital efficiency, stronger security measures, and cross-chain functionality while also promoting greater decentralization throughout the protocol.

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